The local government threatens investigations and administrative penalties in case of failure to comply with orders

Local authorities in the Chinese province of Sichuan have issued a notification to subordinate authorities demanding to ban cryptocurrency mining activities in the region. If the order is not fulfilled, the government will be recommended to investigate illegal projects. This will result in fines, bans, and other administrative penalties. The information is provided by PANews on its Twitter account.

"Hydroelectric power stations in our district should immediately stop investing in mining projects and no longer cooperate with them. Otherwise, we recommend that the district government start an investigation and deal with illegal construction, adopt bans, fines, issue orders for the independent demolition of buildings and other administrative measures," the document says.

PANews noted that previously, the authorities of Sichuan province, on the contrary, supported the mining industry. Thanks to this, the region was able to generate about 9.6% of the hashrate of the bitcoin network. The results achieved will be lost if the ban really comes into force, according to the publication.

However, Twitter user Molly, head of marketing at blockchain startup HashKeyhub and a former employee of Bitcoin Magazine, urged not to panic. According to her, the ban will not happen, and contradictory decrees are normal practice for the local government.

"Don't worry, this won't happen, and it's normal that the government has sent out conflicting messages. The authorities won't really clean up the industry, they just won't give it public support," Molly suggested.

On may 21, it became known that some mining farms in the Chinese province of Sichuan turned off equipment due to a lack of electricity. Since the beginning of the month, the load on the region's networks has increased by 22%, while the volume of water in the rivers has decreased by 20%, which has led to a shortage of hydroelectric power.