What does this mean for us, the common folk?
Well for me I don’t think it will affect us that much, except for the Crypto marketing crashing every time the Chinese government makes a statement or if they just sneeze. Have you seen the market lately? Roller coaster. And not those meant for 10 year-olds either. Kind of sad to see the Crypto market so volatile even when there are so many mature projects out there like Ripple and Cardano.
Anyway back to the topic at hand – what does it mean for the rest of us? If Crypto mining is profitable (and it should be considering that there are a lot of miners out there), people will continue to mine. Big mining corporations will continue to mine. If there is money to be made, it will never go away. As China bans mining, these companies will just move out of China to other countries where electricity is cheap. And with our beloved Elon Musk coming out to proclaim the need for “green” Bitcoin, these Chinese miners could potentially look for partners in the US or even Europe as well, where such renewable energy sources are more established. Anything good for the environment is good for us as well.
It is interesting to note that most Western mining companies do rely on some forms of renewable energy. They have too right? Because if they don’t it might not be profitable for them to do mining and it is nearly impossible to beat the Chinese miners if they use conventional energy sources. If the Chinese miners come in with their huge resource, we might just see the huge boom in renewable energy usage and also research. Furthermore one of the biggest problem with renewable energy is that these are usually located in remote areas – like dams for hydroelectricity, geothermal (aka areas where there are volcanic activities) and could make use of any excess energy by building their mining centers nearby.
And it is good for Bitcoin and other proof of work cryptocurrencies if the majority of the hash rate is not located in one country. Who knows what a government might do if they could just take control of Cryptocurrencies. A successful 51% attack on a blockchain network means the end of that particular Cryptocurrency and spells disaster for the rest. Especially if the cryptocurrency in question is a very popular one like Bitcoin or even something lesser known like Litecoin. The trust in cryptocurrencies would be severely eroded and might never recover. Crypto mining moving out of China might just be a blessing in disguise for the whole industry. Sure, there will be mistakes and uncertainty in the transition period but in the end, I think it is a good thing. We just have to hang on (for dear life). Read to my article on why I still think Bitcoin is relevant.
It is also interesting to note that China did come out and say that they will ban Bitcoin mining in March of this year as well. In fact, nearly every year the Chinese government have been making statements about reducing energy consumption but it still seems to me that the miners are still around. I myself invested in Hashshiny and their mining operations are supposed to be in China. Have not received any email from them about their operations moving away from China either. So lets not be too worried about the China ban. And you can also mine cryptocurrencies yourself. I am mining with Nicehash.