A recent crackdown in China on bitcoin miners who were using electricity illegally – about 7,000 machines were seized in Hebei and Shanxi provinces – raises concerns about the danger of so much of the leading cryptocurrency’s hash rate being concentrated in the totalitarian country, according to a crypto industry observer.

In a recent interview, Ethan Pierse, director of the CryptoAssets Institute, pointed out that what happened in China was not a mining crackdown but merely law enforcement action against electricity theft. Because the price of electricity in China is quite low, people have to register to use large amounts of electricity. Some people, however, flout the law.

Pierse said, “People are going around that even still and tapping into electricity where they can and siphoning that off. So basically, they see that and monitor that there are weird peaks of electricity usage in places and they go and track it down. One miner’s using the same electricity as a single household or dozens of households.”

Pierse said the the recent raids do not indicate that Beijing is shutting down crypto mining operations per se, but merely going after illegal electricity users, AMBCrypto reported.

However, he pointed out that just four regions in China account for 65% of the world’s hash rate and Siachen alone is responsible for 50%. Therefore, if China decides to shut down network access, it could be very problematic.

Pierse said, “If you’re basing your economy or if you’re tying any kind of monetary policy to anything, whether it’s bitcoin or eventually other things, and the mining of that particular cryptocurrency is controlled this much by another government, more or less their ability to shut that down in and of itself can cause severe economic problems for governments or large corporations or other platforms that are leveraging this.”

Also read: Chinese police seize miners, arrest scammers