October 14, 2021

Really, China Is No Longer Top 1 Bitcoin ‘Mining’ Hub?

 As is well known since the middle of this year, China’s aggressive attitude towards the crypto market has become increasingly aggressive especially in Bitcon mining. Following that, the United States (US) has officially broken China’s monopoly in the Bitcoin mining market and become a leading BTC mining hub.

Previously China has monopolized BTC mining for most of the past decade and accounts for more than 70% of mining. . However, crackdowns over the past two especially in May and June have led to massive withdrawals from Bitcoin mining plants.

The majority of miners who moved from China headed to the U.S., Kazakhstan, and Russia. Based on Cambridge data, the U.S. accounts for 35.4% of Bitcoin miners followed by Kazakhstan at 18.1% and Russia with 11%.

Experts argue that the actions of these authorities caused at least 95% of bitcoin miners to move to other countries. Michel Rauchs, at the Cambridge Center for Alternative Finance explains,

"The impact of the authorities' action against China resulted in a 38% drop in hash rates in the global network in June 2021."

On the other hand, the changing demographics of Bitcoin mining are driven by two main factors besides the actions of the authorities. The first is the goal of carbon neutralization in Beijing and the second is the shortage of coal in the country.

As of April this year before the crackdown began in China, the U.S. only accounted for 16.8% of the global hashrate share that has doubled in the last four months. Similarly, Kazakhstan also saw a 120% increase followed by Russia with 61%.