China’s Bitmain Technologies is eyeing bitcoin mining sites in Quebec, a company spokesperson told Reuters, as expectations of a potential Chinese crackdown on cryptocurrency mining make the energy-rich province an attractive alternative.
China has grown into one of the world’s biggest sources of cryptocurrency mining but there are signs Beijing is increasing scrutiny of the sector’s players and may ask local authorities to regulate their power use.
Bitmain Technologies, operator of some of the largest mining farms in the country, is among several companies looking to expand overseas.
Bitmain spokesperson Nishant Sharma said in an email on Friday that the company was looking at sites in Quebec and is in talks with regional power authorities in the province.
It is also planning to expand in Switzerland.
China shutting down cryptocurrency mines
Bitcoin mining consumes large quantities of energy because it uses computers to solve complex math puzzles to validate transactions in the cryptocurrency, which are written to the blockchain, or digital ledger.
The first miner to solve the problem is rewarded in bitcoin and the transaction is added to the blockchain.
While Beijing has not issued any official edict on the bitcoin mines, two Chinese miners told Reuters that local authorities had grown more unwilling to allow expansion and had started to shut down some mines in late 2017, as China clamped down on cryptocurrencies.
Last September, Chinese authorities banned so-called initial coin offerings and ordered Beijing-based cryptocurrency exchanges to halt trading.
“We, and from what I understand many of our peers, are already making plans to go overseas,” said Li Wei, chief executive of ZQMiner, a Wuhan-based company that sells bitcoin mining equipment and has mines in three Chinese provinces.
Flurry of interest in Quebec
Globally, regulators are increasingly voicing concerns about cryptocurrencies, which are not backed by any central bank, because of their volatility and worries about risks to investors.
China, which has strict capital controls, is also worried that cryptocurrencies could facilitate illegal fund flows and breed financial risks.