The average Bitcoin miner was making only $2.50 per day. Meanwhile, the cost of electricity in China skyrocketed to an average of $50 per month in the second half of 2017.
According to the latest data from the crypto mining monitoring website Blockchain.info, the hash power of China’s Bitcoin mining pools fell by about 2.5% on October 9, the day the country’s central bank ordered all exchanges, including OKCoin, to halt trading. At the time, the hash power of China’s Bitcoin mining pools was about 46.9% of that of the whole network, which was nearly as much as that of the United States.
China’s move to curb bitcoin (BTC) mining due to energy concerns is widely seen as a factor in the exodus of miners from Asia to Western countries. However, a new study by the Cambridge Centre for Alternative Finance shows that the changes in the mining sector had already begun before China turned to the mining sector.
According to Reuters, China’s total bitcoin-related computing capacity, or hashrate, dropped from 75.5 percent in September 2019 to 46 percent in April 2021, even before the Asian country officially announced it would stop mining.
In the same 18-month period, the US quadrupled its share of global bitcoin trade, from 4% to 16.8%, becoming the second-largest producer of bitcoin. Another country often cited as a potential transfer target for miners, Kazakhstan, has increased its share to 8% and become a major producer of bitcoins.
Following massive power outages at a mining center in Xinjiang in April, Chinese authorities have launched an investigation into energy consumption related to bitcoin mining. Authorities have announced strict controls on mining operations due to concerns over carbon dioxide emissions, which has prompted several industrial mining companies to leave China.
Related: Banning bitcoin mining is a simple solution for China, says Bitmains EMEA partner
Khurram Shroff, CEO of iMining, called China’s mining ban a temporary inconvenience and said the diversification of mining company locations is good news for the rest of the world. The Toronto Stock Exchange recently listed the world’s first bitcoin ETF, he explains, [Canada] is already ahead of the curve in terms of cryptocurrency adoption.
According to some experts, China’s imposition of restrictions on bitcoin mining was an easy decision. Bitmain’s EMEA partner recently told Cointelegraph that the country needs to reduce its carbon footprint to get funding from the International Monetary Fund or the World Bank, and that bitcoin mining is an appropriate target to minimize energy consumption.
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