John Lincoln
Despite the intense pressure from the Chinese government last year to crack down on cryptocurrency operations, especially mining, the country has again surfaced as one of the biggest Bitcoin mining jurisdictions of 2022.
The Cambridge Bitcoin Electricity Consumption Index (CBECI) provided by the Cambridge Centre for Alternative Finance (CCAF) shows that Chinese Bitcoin mining activities have rebounded, and it’s currently the second-largest worldwide.
Per the statistics, Chinese miners account for 21.1% of the overall global BTC hash rate, just after the United States, which holds 37.8% of the total hash rate.
China has long been the world’s largest Bitcoin mining nation, with the native BTC hash fee energy accounting for more than 75% of the global power demand in 2019. The hash price subsequently plummeted to 0 percent in July and August 2021, owing to the closure of the crypto mining farms throughout China by the government.
Bitcoin mining is done secretly in China
According to the CCAF, “significant underground mining activity has formed in the country” based on data. “Access to off-grid electricity and geographically scattered small-scale operations are among the most common techniques used by subterranean miners to hide their activities from governments and circumvent the ban,” according to a statement.
Chinese miners also try to “spread out their operations,” according to a mining industry insider known as Bob, who provides services for hosting cryptocurrency mining operations in Europe and the United States. He requested to remain anonymous because he is currently trapped in China due to the Covid-19 epidemic.
Miners in China use a VPN to try and avoid using too much power from a single location, so the electrical company can’t detect any unusual energy usage.
Bob
In November, Chinese internet security firm Qihoo 360 released a mining monitor, claiming that Bitcoin mining was still active in the country. At the time, there were an average of 109,000 operating crypto-mining Chinese IP addresses each day, with the majority occurring in Guangdong, Jiangsu, Zhejiang, and Shandong Province.
Since the CCAF began publishing its index in September 2019, China has been the world’s leading bitcoin mining location. The US has surpassed China and now holds 37.8 percent of the bitcoin hash rate, up from 35.1% last June.
Globally, the bitcoin network’s aggregated computing power has resumed its ascent. Last June, the worldwide aggregate compute capacity stood at 57.47 exahashes per second (EH/s), however it hit an all-time high of 248.11 EH/s in February, according to CCAF.
Russia falls out of the top three biggest miners
The latest CBECI upgrade also indicates a modest decline in the share of hash power in Kazakhstan, which is the world’s third-largest BTC mining center. In August, Kazakhstan’s bitcoin hash rate share was 18 percent; it had fallen to 13.2 percent by January.
According to the CBECI statistics, miners now operate in locations that are not specified. Miners now mine roughly 9% of the global BTC hash rate in unknown areas, according to the data. Canada and Russia are the next major mining hubs, accounting for 6.5% and 4.7 percent of the total, respectively.
In addition to withdrawing from the top three nations by BTC hash rate power, Russia’s real hash rate fell from 13.6 EH/s in August to 8.6 EH/s in January.
