China was the undisputed world leader in Bitcoin mining until July 2021, when the Chinese government banned all mining operations in the country.
Chinese mining pools had control of more than 60% of the Bitcoin network’s collective hashrate.
Despite the ban, China still has the second or third highest share of Bitcoin mining globally.
Here was the estimated mining hash power breakdown by country in 2022 according to University of Cambridge Centre for Alternative Finance:
Other interesting stats are:
The stats above are accurate as of September 2023.
As you can see, China was dominating Bitcoin mining by a very wide margin, but now that dominance has shifted to the USA.
In what is being called “The Great Mining Migration”, large mining operations based in China are fleeing the country.
That’s because of a memo from the Financial Stability and Development Committee of the State Council of the Chinese Communist Party.
While the memo is in Chinese, a google translate gives us a good picture of what it actually says:
A prudent monetary policy must be flexible, precise, reasonable and appropriate....The second [goal] is to resolutely prevent and control financial risks...[by cracking] down on Bitcoin mining and trading behavior, and [to] resolutely prevent the transmission of individual risks to the social field.
That night, all mining farms were instructed to shut down permanently.
This DOES NOT mean this hashing power is going offline forever. It just means the miners need to move their operations to other countries.
And most of them seem to be opting for Texas, due to its crypto-friendly regulatory environment, low taxes, and wealth of cheap energy (20% of which is fueld by renewable wind).
This migration marks the first major shift in Bitcoin’s mining history and will no doubt have major implications for Bitcoin going forward.
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