The United States has overtaken China’s leading position in cryptocurrency mining, the latest data show, as China intensifies its crackdown on the sector while many miners leave the country for friendlier shores.
The latest data from the Cambridge Bitcoin Electricity Consumption Index compiled by the Cambridge Centre for Alternative Finance (CCAF) indicate that at the end of August, the U.S. accounted for 35.4% of the global hashrate share — which refers to the level of computing power required to mine — representing a significant surge from 16.8% at the end of April.
Kazakhstan, one of the popular destinations for Chinese miners, came in second with 18.1% of the global hashrate share, up from 8.2% at the end of April, while Russia’s share climbed to 11.2% from 6.8%, according to the data.
China has been clamping down on the crypto mining industry since earlier this year, with the most recent bans being imposed in Jiangsu, Hebei and Gansu provinces, followed by similar clampdowns in Xinjiang, Inner Mongolia, Qinghai, Yunnan and Sichuan.
Notably, on Sept. 24, the National Development and Reform Commission — the country’s top economic planner — jointly issued a notice with 10 other authorities to implement a stepped-up crackdown on crypto mining. In the joint notice, the authorities clearly stated they intend to categorize crypto mining as an outdated industry, in a move to prohibit investments in the sector.
Many miners have fled China for other places that appear to be more regulation-friendly and offer inexpensive power. Some of the top destinations for displaced Chinese miners have included North America, Kazakhstan and Northern Europe.
Michel Rauchs, digital assets lead at the CCAF, wrote in a Wednesday post that mining operations in mainland China have “effectively dropped to zero, from a high of 75.53% of the world’s total Bitcoin mining in September 2019 when this data was first recorded.”
The fallout from the ongoing crackdown has been reflected in hashrate data. The total Bitcoin hashrate had been nose-diving since mid-May, plunging from 180.67 million terahashes per second — an all-time high — to 84.79 million on July 3, the lowest since September 2019, as suggested by data from Blockchain.com. The total hashrate has been steadily recovering since July 3, though it saw a decline over the past week.
On Wednesday, the total Bitcoin hashrate stood at 138.59 million TH/s, down from 150.29 million on Oct. 7, according to the Blockchain.com data.
Other major locations that saw huge mining computing power included Canada — accounting for 9.55% of global hashrate share at the end of April — Ireland with 4.68%, Malaysia with 4.59%, Germany with 4.48%, Iran with 3.11% and Norway with 0.58%, according to the CCAF data.