If you are a Bitcoin watcher or an investor in the cryptocurrency market, you probably remember the recent price drop, a fall that saw the cryptocurrency market shedding billions of dollars in value seemingly overnight.
That swoon was largely the result of actions by the Chinese government, moves many saw as dangerous to the future of Bitcoin. Specifically, the Chinese government said that it would be shutting down Bitcoin exchanges within its borders, leaving many citizens wondering what to do or where to turn.
Now there is another story coming out of China, one that has Bitcoin fans, and specifically Bitcoin miners, just as concerned.
There have been reports that several Chinese Bitcoin mining operations are shutting down, ceasing operations and stopping the search for the elusive blockchain-backed currency.
Also Read: Must-Discover Bitcoin APIs Developers Ought to Have in Their Arsenal
China remains the biggest player in the world of Bitcoin mining, with huge rooms filled with computers and vast amounts of computing power being expended.
Even so, there are reports that a number of large operators have recently ceased operations. Some have reportedly sold off their hardware and moved on to other investments, while others may have picked up their computers and left for other, more Bitcoin-friendly, nations, places with easy access to cheap electricity like Mongolia.
It is important to note that getting accurate information out of China can be difficult, especially information related to Bitcoin and Bitcoin trading.
While there were reports that Bitcoin had been banned in China, that is not the case. Bitcoin trades are still happening in the country, as are the mining operations that produce the cryptocurrency.
There is also no hard evidence that Bitcoin miners are stopping their operation as a result of a government crackdown, or that those miners fear such a crackdown is imminent. Instead, the move to shut down Bitcoin mining operations, if it is true, appears to be a business decision, one that is unrelated to the actions of the Chinese government.
There does seem to be some legitimacy to the claim that the Chinese Bitcoin mining world has been downsizing recently. There have, for instance, been reports that Chinese Bitcoin mining machines have been appearing on CyBTC, a popular auction site for used equipment.
Also Read: The Impact of Cryptocurrency on the Financial Industry
There are also large quantities of the graphics cards used for Bitcoin mining on the market right now, something that is highly unusual. Since these specific graphics cards are widely used by Bitcoin miners, it is clear that there is something going on here.
While it is still unsure what is going on, it is clear that the Bitcoin market in China is going through some significant changes.
Many people feel that the government of China will ultimately regulate Bitcoin transactions, including the miners who discover the digital currency and the exchanges where its citizens buy, sell and invest.
In the meantime, all we can do is watch and wait.
Bitcoin has been a volatile, and controversial, subject from the very start, and that volatility is not going away anytime soon.
The fact that China was responsible for the last Bitcoin crash bears remembering, and recent developments in the Chinese market certainly bear watching.