Representatives of major Chinese bitcoin mining rig maker Canaan Inc. have argued that the industry diminishes energy waste, helps create jobs and nourishes the local economy, as China has been recently cracking down on the practice.
“For-profit miners prefer regions with low electricity prices that indicate oversupply, and likely energy waste,” Canaan CEO Zhang Nangeng said during an earnings conference call, according to Reuters. “Bitcoin miners also help create jobs in impoverished regions and contribute to fiscal coffers.”
Nangeng also argued that although bitcoin mining plants that utilize fossil fuel hamper China’s green efforts, those powered by renewable and sustainable sources should not be affected by the crackdown.
Canaan’s comments follow a statement from the Financial Stability and Development Committee of China’s State Council from May 21. The statement said that the government would “crack down on bitcoin mining and trading behavior and resolutely prevent the transfer of individual risks to the society.”
China’s apparent efforts to hone down on bitcoin mining have apparently been impacting the activity. Furthermore, Nangeng said uncertainty generated by such policies leads miners to leave China, causing some of Canaan’s clients to stop placing new orders for mining equipment.
According to Reuters, overseas markets generated 78.4% of the Chinese bitcoin mining rig maker’s revenues in the first quarter of 2021 — compared to only 4.9% in the same period of 2020.
A country as big as China banning bitcoin mining might seem like a major detriment to the network at first. However, some have argued the exact opposite, including Coin Metrics co-founder Nic Carter –– who posted a video explaining his reasoning. In essence, he claimed that by forcing mining out of China, Bitcoin’s carbon emissions would be reduced without negative impact on the network’s security.