China has continued with its crackdown on cryptocurrencies, resulting in a sharp fall in GPU prices in the country. The move has also plummetted Bitcoin value worldwide as crypto mining operations were halted.
As reported by the state-owned publication, Global Times, Bitcoin mines in Southwest China’s Sichuan province were shut down on Sunday as local authorities ordered all mining operations in the region to stop last Friday. Authorities in other mining hubs in the north and southwest region have taken similar steps, which means over 90% of China’s Bitcoin capacity can be shut down.
China had effectively pushed out crypto exchanges following a 2017 rule change but OTC platforms based overseas were still functional. As the country implements stricter rules regarding any crypto-related financial services that Chinese citizens could avail, these OTC platforms find themselves out of business.
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Why the fall in GPU prices?
For those not familiar, crypto mining has more to do with the GPU capability of a computer rather than its CPU. Crypto farms have been hogging high-end GPUs in order to increase their throughput.
Now as mining becomes frowned upon and even completely banned in most regions of the country, the demand for GPUs has fallen sharply. As crypto farms sell off their mining equipment, which is GPUs mostly, prices continue to fall.
The Nvidia Quadro p1000 (launched in 2017) is selling for 2,429 yuan or $376, as reported by The Register. At the time of writing, the RTX 3060 can be picked for as low as 4,799 yuan or roughly $741. The card was previously reported to be for sale for around 13,499 yuan ($2087). Both the prices come from JD.com, a popular Chinese e-commerce site.
When you consider Nvidia’s recent announcement to cripple mining abilities on its RTX GPUs, this means good news for gamers and PC builders who previously weren’t able to get their hands on these GPUs due to extreme shortages as miners bought out entire new stocks.
What about Cryptocurrencies then?
Bitcoin saw a steep fall in prices following the new rules and so did Ethereum. Bitcoin had dipped more than 10% on Monday and Ethereum also hit a five-week low, according to a Reuters report.
The fall in prices resulted from a selloff and the Peoples Bank of China urged other Chinese banks and financial institutions to crack down harder on trading and other crypto-related transactions.
The market did recover a little bit on Tuesday morning but saw another sharp fall. At the time of writing, BTC is 2.97% down at $32,193.70 and ETH is 6.16% down at $1,895.29.
“The relevant departments of the People’s Bank of China pointed out that virtual currency trading activities disrupt the normal economic and financial order, breed the risks of illegal cross-border transfer of assets, money laundering and other illegal and criminal activities, and seriously infringe the people’s property safety. Banks and payment institutions must strictly implement the “Notice on Preventing Bitcoin Risks” and “Announcement on Preventing Token Issuance Financing Risks” and other regulatory requirements, earnestly fulfill their customer identification obligations, and must not provide account opening, registration, and registration for related activities,” The People’s Bank of China said in a statement.
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