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Chinese electricity supplier rejects rumors of mining ban by Bitcoin

A state-owned electricity company in China rejects rumors that bitcoin mining has been ruled illegal by the government.

Rumors have spread in recent days – according to a leaked document – stating that the country's State Grid would ban the operation of bitcoins at county level in Sichuan Province, an ostensible development due to the Water supply abundant in the region. the fact that Bitcoin miners who seek profit have their headquarters in the region.

A translated version of the document states that "the extraction of bitcoins is an illegal activity," adding further that "every generator connected to the state network that is involved in the operation of the Bitcoin exploitation is also considered an illegal practice, which must be prohibited.This document includes the official stamp of the branch of Dan Ba ​​County, located in Sichuan.

Although promptly disseminated and reported by local Chinese media – raising questions as to whether such a decision may signal an administration move against mining bitcoin (one that would follow the crackdowns on initial offers of coins from currency and trade based on exchange of cryptocurrencies against the Chinese yuan) – subsequent statements indicate that fears may be exaggerated.

According to the Chinese business publication Caixin, local leaders of the county branch confirmed the authenticity of the report, but said that it was only d & # 39; an internal memo and some of these sentences were poorly written. It is also important to note that the document comes from a county branch instead of a state-wide level, thereby decreasing the weight it could carry. .

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"We are a state-owned company, not an administrative branch that has the power to determine whether bitcoin extraction is legitimate or not," said the county branch to the publication.

The company went on to point out that some of the small producers in the area may have violated agreements that prioritized electrical supplies for local residents before business such as bitcoin mining.

At the same time, such a decision may also signal a conflict between the county branch of the State Grid and individual producers over the profits they derive from bitcoin mining.

"This is a fight for the interests of hydroelectric power plants," said Jiang Zhuoer, founder of the Chinese mining pool BTC.TOP, at CoinDesk.

Image of Hydropower via Shutterstock

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