The National Development and Reform Commission (NDRC) of the People’s Republic of China has sway over which industries to encourage, which industries to regulate, and which industries to eliminate. In April the NDRC caused a stir in the crypto space by adding virtual currency mining to the industries that will be eliminated. The NDRC then proceeded to release a draft proposal that would pressure local governments in China to eradicate cryptocurrency mining.
This draft proposal was never ratified into law, and now the NDRC has removed virtual currency mining from the final list of industries that are to be eliminated.
This is certainly resulting in a sigh of relief within the crypto space, since most of the Bitcoin (BTC), mining hash rate is in China. Four of the five top Bitcoin (BTC) mining pools, including Poolin, BTC.com, F2Pool, and Antpool are based in China. These pools alone account for 61.8% of Bitcoin’s (BTC) hash rate, and there is an unknown amount of additional miners aside from these pools that are in China.
Essentially, if China banned cryptocurrency mining then most of the Bitcoin (BTC) hash rate would have gone offline, making the network less secure, and possibly leading to chaotic turbulence in block times as farms in China suddenly go offline.
On the other hand, mining being banned in China may have further decentralized the network, by causing the hashrate to be more evenly distributed across the world instead of centralized in China. Also, miners elsewhere in the world would have seen a significant increase in profits.
Regardless, China is not banning cryptocurrency mining and the status quo continues. That being said, it is clear that China has the power to ban cryptocurrency mining if they decide to at any point in the future.