Cryptocurrency mining rig maker Ebang was accused of inflating sales figures in a short report, while competitor Canaan reported declining fourth-quarter revenue. The end may be nigh for distributed ledger protocol Filecoin, while overseas interest in Chinese cryptocurrency exchanges is on the rise. Finally, Chinese researches say that crypto mining energy consumption could undermine sustainability initiatives.
The world of blockchain moves fast, and nowhere does it move faster than China. Here’s what you need to know about China’s block-world in the week of April 6-13.
The crypto mining rig makers
- Cryptocurrency rig maker Ebang’s stock lost 20% of its value in four days after a short report from Hindenburg research accused it of fraud. The stock has dropped another 5% since April 12. (TechNode)
- Canaan (finally) reported its fourth quarter and full-year 2020 earnings. The company’s revenues continued to decline though it narrowed its losses. The company’s outlook was more positive: It said that it has laid a “solid foundation” for growth in Q1 2021. (TechNode)
- Bitmain sued relative newcomer MicroBT for intellectual property theft for the second time. MicroBT’s founder was a chip engineer at Bitmain. A previous lawsuit over similar claims was dismissed by a Beijing IP court in 2018. (The Block)
The bell tolls for Filecoin
The Distributed Storage Office of China’s Communications Industry Association warned that Chinese companies are using distributed file storage protocol Filecoin to issue unauthorized wealth management products and conduct illegal financing. A new regulation defining illegal fundraising is set to to come into effect on May 1. (China Police Net, in Chinese)
- Traffic on Chinese crypto exchanges from outside China is growing quickly, indicating a rising interest on Chinese tokens. (Wu Blockchain Twitter)
- Binance launched trading of tokenized stocks, starting with Tesla. The carmaker’s stock on Binance is “backed by a depository portfolio of underlying securities.” (Binance)
- The number of transactions on Binance Smart Chain reached an all-time high on Thursday, nearing 5 million. This is more than four times higher than the 1.3 million conducted on Ethereum on the same day. The exchange’s coin, BNB, also reached a historic high of $416 on the same day, and has climbed to $577 since. (BSCScan)
- Huobi’s charity arm pledged $1 million in Bitcoin and Ethereum for UNICEF’s crypto fund, the UN agency’s crypto-backed venture capital department. (TechNode)
Mining and threats
- Carbon emissions due to crypto mining in China could undermine global sustainability efforts, according to a new research paper by Chinese scientists. Environmental goals set in the central government’s 2021-2025 Five-year plan are a big concern to the industry, which consumes vast amounts of electricity. In March, the province of Inner Mongolia proposed shutting down crypto mines to meet green development goals. (Nature Communications)
- On Wednesday, the Sichuan Power Exchange Center said that electricity used for legal crypto mining will increase 150% to 11.3 billion kWh in 2021, with average electricity prices of $0.02/kWh, up 16% from 2020. (Sichuan Power Exchange Center)
- Silicon Valley investor Peter Thiel said Bitcoin mining is a weapon for China, due to its high concentration in the country. Thiel was speaking at a virtual roundtable discussion hosted by the Richard Nixon Foundation. (South China Morning Post)