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The Sichuan province in China has been a hotspot for several cryptocurrency-related activities in the past, attracting miners and other crypto businesses who set up shop in the region. However, a former regulator is now pointing to the development of the region’s electricity sector, and he believes that blockchain technology could play a significant role in developing it.
On October 30, the South China Morning Post reported that Jiang Yang, the former vice-chairman of the China Securities Regulatory Commission, advised strategists at a town hall in Beijing that they could take advantage of the cheap hydroelectricity in Sichuan. Yang believes the region can attract businesses that will no doubt be looking to set up in China, now that the country seems more open to the technology.
The Sichuan region is a blockchain hotspot
Currently, the Sichuan region remains one of the biggest producers of hydroelectric power in China, thanks to a protracted rainy season. The province generated 78.2 gigawatts of electricity and exported another 104 billion kilowatt-hours (kWh) to other regions. An abundance of electricity has led to a reduction in tariffs, with electricity going for as low as 2 cents per kWh during the rainy season. Outside the rainy season, costs remain a meager 4 cents per kWh.
As can be expected, this has led to a flurry of interest from both independent miners and mining companies, as they believe that the area could provide a perfect opportunity for them to maximize operations (and in the long run, profits as well).
Pointing to all this, Jiang reportedly spoke to strategists that China remains the biggest driver of mining in the world, with up to 70 percent of the global mining activity residing in the country.
Blockchain for financial transformation
Jiang also touched on the potential of blockchain to help enhance the Chinese financial industry, calling for more research into using the technology for financial activities that go beyond just what Bitcoin or any other cryptocurrency can offer. While he didn’t go into the specifics of how blockchain could help the country’s financial industry improve, his encouragement would serve as an incentive for more financial institutions to begin looking into how they can upscale their operations with the technology.
On October 21, news medium 8BTC reported that the Cyberspace Administration of China, its Internet regulator and oversight agency, had approved over 300 blockchain services to operate in the country. While most of the services approved belong to tech firms such as Huawei and Alibaba, blockchain tools belonging to certain financial institutions were also approved.
As the news medium notes, one of these is the State Administration of Foreign Exchange, which got regulatory approval for a new cross-border business blockchain service platform.
The China Merchants Bank, a Shenzhen-based commercial bank, also invested in a non-custodial crypto wallet BitPie, according to reports. The nature of the purchase remains unknown, and while some analysts believe it could be a ploy to nationalize the Chinese blockchain and crypto space, it is possible that the bank wants to integrate the wallet into its offering to provide for faster and more seamless transactions.