BITCOIN MINING IN CHINA IS NOT DEAD YET

 

39% of the Bitcoin hash rate was still in China as of January this year.

The Center for Alternative Finance at the University of Cambridge has revealed that Bitcoin mining in China continues despite a strict ban imposed by the government since mid-2021.

As of January of this year, the Asian nation continued to be the second country with the largest share of computing power in the Bitcoin network, according to the latest data presented by the Center for Alternative Finance at the University of Cambridge.

An update to the Bitcoin Electricity Consumption Index, dated January this year, has revealed that China held 39.6% of the Bitcoin hash rate for the date. Which means that cryptocurrency miners have reconnected their mining equipment to operate in the country, despite the strict restrictions that the government has imposed on the crypto industry since the middle of last year.

China, which became the leading power of Bitcoin, with more than 90% of the network hash rate within its territory, ceded power to the United States when the authorities began to attack the miners, forcing them to close their operations and migrate from the country in search of new friendly jurisdictions with this activity.

The Chinese government had even threatened with jail and exorbitant fines those who were dedicated to mining crypto assets with the country's resources.

Distribution of the Bitcoin hash rate in the world

The offensive implemented by the Chinese authorities against Bitcoin miners caused their mass exodus. Many of the miners of this cryptocurrency have found refuge in the United States, within states such as Wyoming and Texas, which now lead this crypto activity.

According to data from the Center for Alternative Finance at the University of Cambridge, the United States accounts for 71% of the global hash rate of the Bitcoin network, followed by China as the second country with the highest share of computational power within this blockchain.

Cambridge University data is current as of January this year.

The chart shows how Bitcoin hash power was heavily concentrated in China between 2019 and Q3 2020, when the network hash rate reached 91.1% in the country. China was the greatest paradise for miners at the time, who benefited from its cheap and abundant energy.

However, as of October 2020, the Bitcoin hash rate in China began to fall, while in other regions, such as the United States and Russia, it increased.

In July of last year, a month after new restrictions were imposed by the local government, Bitcoin mining appeared to have disappeared from China, data from the Cambridge CBECI shows. However, this activity resurfaced in the month of September, even showing an important participation with 30% of the Bitcoin hash rate located in the Asian nation.