The Chinese region of Inner Mongolia has banned cryptocurrency mining and declared that it will close all such projects before April, raising fears that the world's second-largest economy will take more steps to eradicate this energy-wasting practice.
Inner Mongolia is the favorite region for the mining industry because the cost of energy is extremely cheap, and while in the past that has helped attract investment from a plethora of energy-intensive sectors such as aluminum smelting and ferroalloys, in recent decades, mining farms have multiplied to the point of presenting a serious problem at the level of energy demand.
The region represents 8% of the world's computing power for Bitcoin mining, according to the Bitcoin Electricity Consumption Index produced by the University of Cambridge. While China accounts for more than 65% of the total grid, offering an excellent mix of cheap electricity, local chip-making factories, and cheap labor.
Not only will all cryptocurrency mining projects have to close at the end of April this year, but also small companies with outdated technology in the steel, ferroalloys, copper, graphite electrodes, and coal power. All have received a closing schedule for the end of 2022.
On the other hand, the region will invest in renewable energy with the goal of installing more than 100 gigawatts of renewable generation capacity by 2025.
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