The US has successfully managed to overtake China as the largest miner of bitcoin following Beijing’s crackdown on the country’s established cryptocurrency industry earlier this year. The US’s share of global hash rate — the computerised power required to generate bitcoin — was estimated to be 35.4 percent, more than double the 17 percent recorded earlier this year in April.
Meanwhile, China’s share of the global hash rate fell down from 44 percent recorded in April to nil due to curbs imposed on the trading of cryptocurrency beginning from May, a Cambridge Centre for Alternative Finance study published on Wednesday found.
China has been the hub of bitcoin mining since its inception in 2009 due to the availability of cheap electricity, which is required for creating bitcoin. The booming crypto industry in the country then went on to acquire three-quarters of the global share of hash rate by 2019.
After over a decade of establishing itself as the epicentre for bitcoin mining, the Chinese government had banned the practice in May citing environmental concerns emerging due to the excessive use of electricity by bitcoin miners and the financial risk that surrounds the volatile crypto market.
However, experts believe that bitcoin is still being stealthily mined in China through the use of VPNs and proxy servers which records the mining as happening from a different country. This method is being speculated as a possible reason for the increase in hash rates in countries such as Germany and Ireland.
In the meantime, bitcoin miners are being prompted to relocate operations to different countries in search of cheap electricity and accommodative policies.