How Another Chinese Power Outage May Have Led to Bitcoin’s Flash Crash This Week

[Micky]

Earlier in April, an accident at a Chinese coal mine in Xinjiang sent Bitcoin network’s hash rate plummeting 30% in a span of a day, which crippled the major cryptocurrency’s rally.

Now, Bitcoin’s hash rate is suffering a similar loss as miners based in Sichuan, China face limitations on power usage.

The State Grid in Sichuan’s Aba county — which encompasses a significant portion of the region’s hydropower — issued a notice earlier this week that required local enterprises and households to limit their power consumption as the province was met with a surging utility demand.

The notice was specifically aimed at all operations located in the region’s “Hydro-electricity Consumption Industrial Demonstration Zone.”

These zones were created by the government as a form of incentive for “power-intensive industries” to utilise cheap hydroelectricity during summer months. Many of the Bitcoin mining facilities were allegedly operating in these government-sanctioned industrial zones.

Sorce