Digicoin’s summer of misery continues as China extends ban on mining and green backlash intesnifies
(AF) Bitcoin’s winter boom has been followed by a summer of discontent.
The leading crypto-currency has fallen below $30,000 for the first time in five months amid concern that China’s crackdown on mining the digicoin will prevent more being created and as its green credentials are questioned.
Bitcoin sank as low as $29,334, a level last seen in January. It later stood at $29,590, down 9.25%.
“Concerns mount over China’s ongoing clampdown and fears that widespread acceptance of bitcoin and other digital currencies will be delayed because of concerns about their environmental impact,” said analyst Fawad Razaqzada at trading site ThinkMarkets.
Also on AF: Bitcoin prices cave as China’s mining crackdown continues
Bitcoin also faces a green backlash because mining often uses electricity produced from fossil fuels, he noted.
China has broadened a crackdown on its massive cryptocurrency mining industry with a ban on mines in the key southwestern province.
Chinese mines power nearly 80% of the global trade in cryptocurrencies despite a domestic trading ban since 2017, but in recent months several provinces have ordered mines to close as Beijing turns a sharp eye to the industry.
Authorities in the province of Sichuan ordered the closure of 26 mines last week, according to a notice widely circulated on Chinese social media and confirmed by a former bitcoin miner.
Sichuan, a mountainous region in southwest China, is home to a large number of cryptocurrency mines — huge data centres which require a colossal amount of energy.
Bitcoin and other cryptocurrencies are minted by solving puzzles using powerful computers that consume enormous amounts of electricity — much of which is usually produced by coal plants.
-
Reporting by AFP
