China Secretly Controls 55% of Global Mining

Despite China’s official ban on cryptocurrency mining in 2021, the nation still casts a long shadow over the global Bitcoin mining landscape. Recent findings indicate that approximately 55% of the world’s mining operations are still secretly managed from China, surpassing even the United States.

China’s Continued Influence Over Bitcoin Mining

Three years have passed since China enforced its crypto prohibition, yet it remains a formidable force in the Bitcoin mining industry. According to Ki Young Ju, CEO of CryptoQuant, Chinese mining entities still command 55% of the global hash rate. This dominance dwarfs the United States, which holds a 40% share.

The persistence of Chinese miners can be attributed to their adaptability. Despite the ban, they have utilized innovative methods to sustain operations covertly. Some relocated to nearby countries but maintain remote control from China.

Moreover, China’s pre-existing vast mining infrastructure continues to provide a competitive edge. Provinces with abundant hydroelectric power, including Sichuan, offer reduced operational costs, which are instrumental in sustaining these secret mining activities.

Potential Regulatory Changes in China

Despite these clandestine operations, there are emerging signs hinting at a possible regulatory shift. By 2025, discussions are revolving around incorporating crypto transactions into anti-money laundering statutes, indicating a potentially more practical stance.

Technological advancement competition with the United States is a vital factor in these discussions. As American mining operations grow more sophisticated, China might not want to lag behind in a sector it once led. Nonetheless, any loosening of restrictions will likely come with stringent regulations to mitigate financial risks and prevent capital flight, which are significant concerns for the Chinese government.

China’s undisclosed control over a large portion of the Bitcoin mining sector underscores the intricate dynamics of the global crypto arena. The continued existence of the crypto black market in China adds another layer of complexity. The country’s future within the cryptocurrency industry remains unpredictable but intriguing.

Fenelon L.

Passionate about Bitcoin, I love exploring the intricacies of blockchain and cryptos and sharing my discoveries with the community. My dream is to live in a world where privacy and financial freedom are guaranteed for everyone, and I firmly believe that Bitcoin is the tool that can make this possible.

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author and should not be taken as investment advice. Conduct your own research before making any investment decisions.