A few days after Sparkpool, another ETH mining pool dubbed BeePool shut down due to the Chinese harsh regulatory climate and ban. Alibaba and Binance both responded to the crypto crackdown as well so let’s read more in our latest ETH news today.
Last week China launched a new war on crypto and the crypto businesses started feeling the effects. A day after SparkPool as the second biggest ETH mining pool in the world announced to be closing down, the fourth biggest mining pool joined in. BeePool based in China announced that it will shut down before midnight and said that it stopped registering new users, explaining that the closure came in response to the latest regulatory policies but also cited “Regulatory requirements. “ According to the data from Etherscan block explorer, the two mining pools were responsible for one-quarter of all ETH mined.
Mining is a process by which teh transactions are processed and confirmed ont the ETH network. People can contribute computing power which helps secure the network and the more they provide, the better chance they have at winning all of the ETH that is doled out with the new blocks created. Mining pools work by letting people pool their computer power and then share the rewards. The shutdown of China’s two biggest mining pools came amidst the renewed crackdown on crypto by the Chinese government. Last week we saw People’s Bank of China circulate a notice that any activity regarding crypto is against the law.
The country was clamping down on crypto since 2017 when PBoC banned financial institutions from conducting crypto transactions but its efforts are only enhancing. The past winter tehre was a drop in Bitcoin’s hashrate which is a measure of computing power on the blockchain which correlates to the network secufrity as the mining operations in the areas with cheap electricity was told to shut down. Three major Chinese payment associates including the China Banking Association repeated the ban.
Sparkpool was among the first companies to stop accepting new users from China due to the regulatory ban.
This is why another ETH mining pool has closed down and Alibaba also noted that it will stop selling customized crypto equipment while Coingecko was blocked by the Chinese government censors. Major exchanges like Huobi and Binance stopped registering mainland Chinese residents and the prices of most cryptocurrencies drowned in red.