After China completely banned cryptocurrency mining, what happened to the mining industry today?
China bans cryptocurrency mining
Between May and June 2021, China has issued a number of policies.
- Restrict the trading of encrypted digital currencies.
- Prohibit the operation of encrypted digital currency mining farms.
On May 25, Inner Mongolia issued a policy restricting the operation of mines in Inner Mongolia.
On June 9, Qinghai Province issued a policy requiring Qinghai Province to ban cryptocurrency”mining” behavior.
Sichuan Province issued a policy requiring all mines in Sichuan to stop operations before June 20.
Due to factors such as risks, China has always restricted virtual currency transactions. However, the virtual currency mining industry was not restricted before this year. China used to be a major gathering place for the mining industry of Bitcoin and other cryptocurrencies.
Changes after China’s ban on mining
According to data from the University of Cambridge in the United Kingdom, China once occupied 65.08% of Bitcoin’s computing power. However, the intensity of this supervision has been so great that many people in the industry have said it has never seen it before. The blow also led to a drop in the computing power of Bitcoin’s entire network.
According to data from BTC.com, on July 13, 2021, the average computing power of Bitcoin’s entire network was 97.21 EH/s, which was nearly 51% lower than the historical high of 197.61 EH/s (May 13).
In fact, after the miners closed their business in China, the hash rate of the Bitcoin network has gradually recovered from the low point in July.
According to data from the data analysis website Y Chart, as of October 14, the hash rate of the Bitcoin network has risen from the low point of 61 EH/s in July by about 117% to 135.48 EH/s per second.
Source: Blockchain website
The rise of U.S. cryptocurrency mining
After China completely banned the mining industry, the United States replaced China as a gathering place for the mining industry. The industry believes that this trend will not stop soon.
CCAF data shows that American miners have gradually taken over Bitcoin mining operations.
As of the end of September, the United States accounted for 35.4% of global computing power, more than four times the amount in September 2020.
Source: CambridgeCentre for Alternative Finance
At the same time, the percentage of mining in China has actually dropped from a high of 75.53% to 0%.
According to CCAF data, Kazakhstan and Russia are now closely behind the United States. Today’s computing power shares are 18.1% and 11.23%, while the previous two countries’ computing power shares were 8.2% and 6.8% in April.