June 22, 2021: -On Monday, Bitcoin sank on reports that China has intensified its crackdown on cryptocurrency mining.

According to data from Coin Metrics, the largest digital currency of the world decreased 7% to a price of $32,801, dropping below $33,000 for the first time since June 8. It was the last trading at $33,243 as of 5:50 a.m. ET. Smaller rivals such as ether and XRP also tumbled, down 8% and 7%, respectively.

On Sunday, many bitcoin mines in Sichuan were shuttered after authorities in the southwestern Chinese province ordered a halt to crypto mining, according to a report from the Communist Party-backed newspaper Global Times.

Above 90% of the bitcoin mining capacity of China is estimated to be shut down, the paper said.

Bloomberg and Reuters also reported on the move from Sichuan authorities. Following similar developments in China’s Inner Mongolia and Yunnan regions and calls from Beijing to stamp out crypto mining between the worries over its massive energy consumption.

On Monday, Separately, China’s central bank said it had summoned Alipay, the payments service run by Alibaba affiliate Ant Group, and some significant banks that urge them to crack down on crypto trading. In addition, China had banned financial institutions from providing services related to crypto.

China’s crackdown has led to a significant decline in bitcoin’s hash rate or processing power which has decreased sharply in the last month, according to data from Blockchain.com. An estimated 65% of global bitcoin mining happens in China.

Bitcoin’s network is decentralized, which means it doesn’t have any significant party or middleman to approve transactions or generate new coins. Instead, the blockchain is maintained by so-called miners who race to solve complex math puzzles using purpose-built computers to validate transactions. Whoever wins that race is rewarded with bitcoin.

This power-intensive process has led to growing concerns over the potential environmental harm of bitcoin, with everyone from Tesla CEO Elon Musk to U.S. Treasury Secretary Janet Yellen raising the alarm. China, where most bitcoin mining is concentrated, relies heavily on coal power. Last month, a coal mine in the Xinjiang region flooded and shut down, taking nearly a quarter of bitcoin’s hash rate offline.

However, miners in China often migrate to places such as Sichuan, rich in hydropower, in the rainy season. And some industry efforts have been launched, including the Bitcoin Mining Council and the Crypto Climate Accord, to reduce cryptocurrencies’ carbon footprint.