Recently, I saw someone discussing Bitcoin mining again, which reminded me of that research report from Cambridge University. Honestly, to understand what mining is, you first need to understand why it consumes so much electricity.

Data from mid-2021 shows that Bitcoin mining's annual electricity consumption has reached 134.89 terawatt-hours. If you consider mining as a country, its energy usage ranks in the top 30 globally, equivalent to Malaysia's entire annual electricity consumption. This number sounds alarming, but the logic behind it is actually quite simple.

What is mining? In simple terms, it's using computational power to solve mathematical problems; whoever solves it first gets rewarded with Bitcoin. It sounds straightforward, but the problem is that the difficulty keeps increasing. Bitcoin's design limits its total supply to 21 million coins, and every 210k blocks, the reward halves.

In the early days, Satoshi Nakamoto mined 50 Bitcoins with a home computer, and the electricity cost was negligible. But as more people joined, mining difficulty increased exponentially, requiring more and more computing power. What used to be mining one Bitcoin per day on a single computer now requires hundreds or thousands of mining rigs working simultaneously. That's why a single mining machine consumes about 35 kW, and an entire mining farm's daily electricity consumption can meet a person's lifetime energy needs.

Mining operators keep purchasing faster and more efficient machines to stay ahead of competitors. This process not only consumes electricity for the hardware itself but also for cooling fans and power supply systems. It is said that by 2024, Bitcoin mining in China will consume as much electricity annually as 3.5 Three Gorges Dam hydroelectric plants.

Is the Bitcoin mined worth it? That's an interesting question. Bitcoin was born during the 2008 financial crisis, when the Federal Reserve was printing money like crazy. Satoshi Nakamoto aimed to challenge the dollar hegemony with digital currency. Initially, it was only circulated among programmers; some people exchanged 1,000 Bitcoins for two pizzas. But as its popularity grew, the price became surreal, even surpassing $68,000 in 2020.

However, there's a problem: Bitcoin is not a necessity. It’s not a tangible commodity and is difficult to value based on labor theory. In simple terms, its high price now is a bubble created by speculation. Its only potential value might be its decentralization and anonymity, but these features also make it a hotbed for money laundering and scams.

So, why does our country crack down on Bitcoin speculation? The reasons are compelling. First, resource waste: before May 2021, nearly 70% of global Bitcoin mining farms were in China. Miners would buy cheap hydroelectric power in Yunnan, Guizhou, and Sichuan during the rainy season, then switch to thermal power in Xinjiang and Inner Mongolia during dry periods. This puts enormous pressure on domestic electricity resources. Second, the anonymity of Bitcoin facilitates black-market activities. Lastly, and most importantly, it’s about safeguarding monetary sovereignty. El Salvador made Bitcoin legal tender, but this year, during the bear market, they lost over ten million dollars and are nearly bankrupt.

Ultimately, "speculating on cryptocurrencies" is no different from gambling. It consumes not only electricity and money but also people's rationality and society’s hardworking spirit. Therefore, the government's firm crackdown is a wise move.