China’s new move could bring great benefit to Bitcoin miners
- China's city of Yaan recently published a reform that would help reduce the cost of electricity.
- The move comes as a way of helping the blockchain and mining industries.
- With uncertainty due to coronavirus and Bitcoin halving, such a move would help the remaining miners.
China’s city of Yaan, located in the Sichuan region, recently published a reform about the construction of hydropower consumption. Interestingly enough, the move comes in an attempt to help the development of the blockchain industry. It will likely reduce the cost of electricity in the area by quite a bit, and definitely enough to keep the city a major player in crypto mining.
China’s city to reduce electricity cost
It is not exactly a secret that mining Bitcoin is expensive. Apart from the expensive gear, miners also need to spend a lot of electricity, which can lead to very high bills. Of course, Bitcoin’s price is usually high enough to cover such costs and still provide miners with certain earnings.
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But, with the approaching halving, the rewards for mining will get cut in half. Naturally, many are quite worried about the profitability of mining. While the community worried about the future of mining, local organizations in Yaan revealed a new joint venture.
The venture’s name is “Implementation Opinions on the Construction of Hydropower Consumption Demonstration Zones to Support the Development of the Blockchain Industry.” Basically, the goal is to use massive water resources of the region and use it to ‘seize major strategic opportunities’ for blockchain.
How will the move help the blockchain industry?
The initiative holds a lot of potential, and it could even turn Yaan into a major blockchain hub. Of course, alongside the blockchain industry, this entire region would benefit.
The statement did not provide precise information regarding the price reduction. However, sources familiar with the plans made their own estimates, noting that the cost could go down by $0.03 (0.20CNY) during the raining season.
Apart from making the mining more profitable, the move would also ensure that China keeps its dominance in the industry. While it already controls the majority of the hash rate, it could still improve its position further through such a move.
As mentioned, the block reward halving already has people concerned about mining profitability. Reduced prices would be just what they need to give them hope and convince them to stick around. Also, the move could also help the mining industry recover from multiple mining pool shutdowns caused by the coronavirus.