The Cambridge Center for Alternative Finance claims that the computing power of BTC in China had already dropped by 40 % before the mining suspension, while the hash power of the United States had quadrupled at the same time.
China’s mining ban has rebuffed the hashrate maps of the BTC network around the world
China’s crackdown on bitcoin (BTC) miners on energy consumption grounds is widely seen as the trigger for the the exodus of Asian crypto miners to western countries. However, new research conducted by the Cambridge Centre for Alternative Finance suggest that the evolution of mining power began before the tightening of Chinese legislation.
The Cambridge Centre for Alternative Finance is a research institute created in 2015 as part of the Cambridge Judge Business School from the University of Cambridge, UK. The center’s research focuses on financial channels and instruments that are emerging outside of traditional financial ecosystems, particularly cryptocurrencies.
According to the figures, China’s total computing power connected to the Bitcoin (or hashrate) network had experienced a sharp and rapid decline from 75.5% in September 2019 to 46% in April 2021 of the entire network. The middle Kingdom had not yet announced official measures to ban mining but the miners had apparently been able to anticipate it.
In the same 18-month period, the United States was double-dipping by quadrupling its share of the global bitcoin hash rate. From 4 % to 16.8 %, the country of Uncle Sam recovered from its superb to become the second largest producer of bitcoin. Kazakhstan, a former Soviet republic often associated with btc mining, increased its share to 8 % and thus became one of the leading bitcoin producers in the world.
China’s mining crackdown will finally benefit BTC network
After suffering massive power outages in the mining center of Xinjiang in April (presence of coal mines), the Chinese authorities began to worry about another form of mining, the very energy-intensive one of bitcoin mining. In addition, the need for China toshow concrete actions to limit greenhouse gas emissions such as carbon eventually led to the relocation of several industrial miners out of China.
Some experts consider the ban on mining in China to be a predictable decision due to the environmental commitments made by the world’s second-largest economy to international institutions such as the IMF or the World Bank. As a result, the country was able to quickly reduce its carbon footprint overnight and minimize energy consumption.
Even if the BTC network has suffered temporary inconveniences, this ban makes it possible to diversify and better distribute computing power globally, which in the end is good news for a decentralized network and removes the spectre of a 51% attack led by the Chinese state. In the end, this is great news for all crypto assets !
Graduate engineer, escaped from open space, I found happiness on the internet and I believe in crypto.
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The words and opinions expressed in this article are the sole responsibility of the author and should not be considered as investment advice. Conduct your own research before making any investment decisions.
