The authorities of the Inner Mongolia Autonomous Community of China have proposed to close all local cryptocurrencies in order to reduce energy consumption in the region.
The National Development and Reform Commission of Inner Mongolia (NDRC) has made a formal proposal to close local cryptocurrency mining in accordance with its energy conservation rules.
The draft proposal was published on February 25 and proposes a “comprehensive clean-up and closure of virtual currency mining projects” by the end of April 2021. The authorities have also proposed introducing a strict ban on new cryptocurrency mining projects in the region. The NDRC will collect public comments on the draft proposal by March 3, 2021.
According to a Reuters report, Inner Mongolia was the only region out of 30 mainland regions for which Beijing conducted an energy consumption and energy intensity survey that was unable to meet its 2019 energy saving targets.
As part of a new energy control proposal, Inner Mongolia aims to cap energy consumption growth to around 5 million tonnes of standard coal equivalents by 2021. The government also plans to reduce energy intensity – the amount of energy consumed per unit of economic growth – by 3% from the 2020 level. The region’s energy intensity is reported to have increased by 9.5% between 2016 and 2019, while total energy consumption increased by about 65 million tonnes.
Inner Mongolia has become a popular destination for cryptocurrencies due to low electricity prices. However, it is clear that in recent years, local authorities have been planning to take action to combat cryptocurrency mining in the region and have issued several statements investigating the activities of local mining companies. In August 2020, Inner Mongolia officials considered a new policy prohibiting workers working with cryptographic memory from using government-subsidized electricity.