Regulations Over Bitcoin Mining And Trading Of Crytocurrency In Different Countries

CAN THE CRYPTOCURRENCY CRAZE BE CONTAINED? OR EVEN REGULATED?

We need to get a sense of why bitcoin isn’t regulated and how China’s recent move to ban trading may spur a slew of changes in the industry.

WHY IS BITCOIN MINED? Significant resources, including electricity (where the bulk is purportedly fossil fuels versus renewable sources) and water for cooling, are essential for the computing power required to “mine” the bitcoin. At the dawning of the bitcoin era, computer enthusiasts could easily mine it.

However, today’s efforts require sophisticated and massive computing server farms to make the endeavor profitable.

An algorithm, called Difficulty, is constantly adapting. Adjustments to the algorithm are essential to control the rate of mining so that only one new bitcoin is “unearthed” globally every 10 minutes. Each time the algorithm puzzle is solved, a new BTC is generated.

CHINA’S LATEST MOVE Experts believe that about two-thirds of all crypto mining is conducted in China. Direct access to the specialty computers required to do the mining, which is typically manufactured in China, coupled with the availability of low-cost electricity (via coal) and other resources, make the country an attractive place to set up a crypto mine.

China banned its banks from handling cryptocurrencies, but trading continued. The new ban, issued in September 2021, provides the strongest language yet. Perhaps the ban was issued to clear a path for The People’s Bank of China to release their electronic yuan to facilitate cashless transactions that can be tracked. And taxed accordingly. Comparatively, the US has recently stated that it has no plans to ban crypto.

https://www.shieldfc.com/