China leaves bitcoin mining out of list of restricted activities

SHANGHAI (Reuters) - China, which is among the biggest manufacturers of bitcoin mining gear, has decided against eliminating the mining of the cryptocurrency, the state planner has indicated.

FILE PHOTO: A cryptocurrency mining computer is seen in front of bitcoin logo during the annual Computex computer exhibition in Taipei, Taiwan June 5, 2018. REUTERS/Tyrone Siu

The National Development and Reform Commission (NDRC) in April sought public opinion on a revised list of industries it wanted to encourage, restrict or eliminate. Bitcoin mining was among the activities on the list at the time.

However, the final list published by the state planner on Wednesday did not mention bitcoin mining. Its exclusion was reported by industry website CoinDesk.

It was not clear what the NDRC’s reasons were. The NDRC did not immediately respond to a faxed request for comment.

China is the world’s largest market for computer hardware designed to mine bitcoin and other cryptocurrencies, but such activities have fallen in a regulatory gray area.

While China has been developing its own digital currency, it has in recent years moved to tightly regulate the wider sector.

In 2017, it started to ban initial coin offerings and shut cryptocurrency trading exchanges and it also began to limit cryptocurrency mining, forcing many firms - among them some of the world’s largest - to find bases elsewhere.

Nearly half of bitcoin mining pools – groups of miners who team up for economies of scale - are in the Asia-Pacific, a Cambridge University study said last year.

Chinese companies are also among the biggest manufacturers of bitcoin mining gear.

Last month, Canaan Creative, one of China’s biggest bitcoin mining hardware makers, filed to publicly list on the Nasdaq to raise $400 million, its third attempt to do so after previous failed tries in mainland China and Hong Kong.

Reporting by Brenda Goh; Additional Reporting by Shanghai Newsroom