After the mining ban in China, local bitcoin miners still generate up to 20% of the total hashrate of the cryptocurrency network. It is reported by Twitter#Echobox=1639832520">CNBC with reference to experts.
One of the miners, who identified himself as Ben, told the publication how local industry players work underground. He has been mining since 2015 and has 6,000 devices.
After the beginning of the repression by the authorities, Ben distributed the equipment among many facilities so as not to emit too high power consumption on the network.
He installed 1000 units throughout the country, wherever he could get the capacity. This equipment is supplied with power from the public mains. 5,000 miners are directly connected to two small hydroelectric power plants in Sichuan province.
In addition, Ben is taking steps to hide his geographic digital footprint.
He said that while doing business in China, he is accustomed to using “workarounds”, but in the past six months, “the rates have really increased.”
“We never know how tough the government will take to destroy us,” said the miner.
The precautions did not help him escape detection by the authorities. Ben explained that mining is being monitored for suspicious traffic by one of the largest telecommunications companies, China Telecom. It transmits information about possible violations to the central government, from where it is forwarded to the municipal levels. Local authorities are in direct contact with the owners of the power plants to investigate the case.
This happened with one of Ben’s farms, but it was covered by the owner of the hydroelectric power plant. The equipment had to be turned off for several days. He returned it to the network after additional actions to mask cryptocurrency mining operations.
According to the Chinese cybersecurity company Qihoo 360, 109,000 IP addresses were used daily for mining in November. The main activity was in the provinces of Guangdong, Jiangsu, Zhejiang and Shandong.
Industry players previously working in China and familiar with the situation have confirmed to CNBC that miners are continuing to operate in the country.
According to them, the repression affected mainly big business. Some companies have transported equipment abroad. Others left the rigs in warehouses, but reserved hosting and capacity outside of China and ordered new, latest generation miners.
Smaller enterprises could not relocate for a number of reasons. Many shut down installations for several weeks, but then brought them back online with the precautions Ben described.
One of the miners added that some large pools provide technologies to help hide suspicious traffic.
But, according to the vice president of Foundry Kevin Zhang, the Chinese miners will face a problem in the form of the onset of the dry season in Sichuan and Yunnan. In the past years for this period, equipment has been moved to Xinjiang and Inner Mongolia, where electricity is mainly generated from coal. However, there are no small private power plants that can be connected to without coming under the attention of the authorities, Zhang said.
According to him, the share of China in the bitcoin hashrate will fall to 5%.
Recall that the Center for Alternative Finance at Cambridge University in August showed a drop in the share of China in the total computing power of the network to zero. The USA became the leader with 35.4%.
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After the mining ban in China, local bitcoin miners still generate up to 20% of the total hashrate of the cryptocurrency network. It is reported by Twitter#Echobox=1639832520">CNBC with reference to experts.
One of the miners, who identified himself as Ben, told the publication how local industry players work underground. He has been mining since 2015 and has 6,000 devices.
After the beginning of the repression by the authorities, Ben distributed the equipment among many facilities so as not to emit too high power consumption on the network.
He installed 1000 units throughout the country, wherever he could get the capacity. This equipment is supplied with power from the public mains. 5,000 miners are directly connected to two small hydroelectric power plants in Sichuan province.
In addition, Ben is taking steps to hide his geographic digital footprint.
He said that while doing business in China, he is accustomed to using “workarounds”, but in the past six months, “the rates have really increased.”
“We never know how tough the government will take to destroy us,” said the miner.
The precautions did not help him escape detection by the authorities. Ben explained that mining is being monitored for suspicious traffic by one of the largest telecommunications companies, China Telecom. It transmits information about possible violations to the central government, from where it is forwarded to the municipal levels. Local authorities are in direct contact with the owners of the power plants to investigate the case.
This happened with one of Ben’s farms, but it was covered by the owner of the hydroelectric power plant. The equipment had to be turned off for several days. He returned it to the network after additional actions to mask cryptocurrency mining operations.
According to the Chinese cybersecurity company Qihoo 360, 109,000 IP addresses were used daily for mining in November. The main activity was in the provinces of Guangdong, Jiangsu, Zhejiang and Shandong.
Industry players previously working in China and familiar with the situation have confirmed to CNBC that miners are continuing to operate in the country.
According to them, the repression affected mainly big business. Some companies have transported equipment abroad. Others left the rigs in warehouses, but reserved hosting and capacity outside of China and ordered new, latest generation miners.
Smaller enterprises could not relocate for a number of reasons. Many shut down installations for several weeks, but then brought them back online with the precautions Ben described.
One of the miners added that some large pools provide technologies to help hide suspicious traffic.
But, according to the vice president of Foundry Kevin Zhang, the Chinese miners will face a problem in the form of the onset of the dry season in Sichuan and Yunnan. In the past years for this period, equipment has been moved to Xinjiang and Inner Mongolia, where electricity is mainly generated from coal. However, there are no small private power plants that can be connected to without coming under the attention of the authorities, Zhang said.
According to him, the share of China in the bitcoin hashrate will fall to 5%.
Recall that the Center for Alternative Finance at Cambridge University in August showed a drop in the share of China in the total computing power of the network to zero. The USA became the leader with 35.4%.
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