China has long been the largest Bitcoin mining site in the world. But not anymore, since the government of the Bamboo Curtain Country carried out a large-scale raid and even banned all transactions with cryptocurrencies. So there was no choice, the miners were busy leaving the country.
Now for the first time, China is no longer the main favorite location for Bitcoin miners but the United States. Last July, according to the Cambridge Center for Alternative Finance, 35.4% of Bitcoin hashrate, the industry term to describe the collective computing power of miners, was in the US, up 428% from September 2020.
Whereas just 12 months ago, China was the leader of the harshrate market by a very large margin. But Bitcoin mining raids there instantly took the miners 'offline'.
Bitcoin miners are also flocking to leave China en masse, to areas with cheap energy sources. Many of them then chose to come to the land of Uncle Sam.
"The whole narrative that China controls Bitcoin right now is completely shattered," said Boaz Sobrado, a London-based financial analyst.
Whereas 12 months ago, China was the leader of the harshrate market by a very large margin. But Bitcoin mining raids there instantly took the miners 'offline'.
Miners are flocking to leave China en masse, heading for areas with cheap energy sources. Many of them then chose to come to the land of Uncle Sam.
"The whole narrative that China controls Bitcoin right now is completely shattered," said Boaz Sobrado, a financial analyst in London.
Why choose to America? There are many contributing factors. Call it a state like Texas has energy sources including the cheapest in the world. In America there are also many renewable energy sources. Environmentally friendly water-based to nuclear energy is available. This is a solution for miners so that they no longer pollute the environment.
The Chinese government is indeed unmitigated in raiding cryptocurrencies such as Bitcoin, Ether, and others. After closing many Bitcoin mines, the government of the Bamboo Curtain Country declared that all transactions related to crypto money were illegal.
As quoted by detikINET from the Independent, the announcement was issued by the Central Bank of China and became the loudest in cryptocurrency raids. The value of cryptocurrencies such as Bitcoin also dropped following the announcement.
China calls all business activities using cryptocurrencies illegal. "All cryptocurrencies are not legal compensation and should not and cannot be used in the market as money," their statement reads.
Domestic or foreign institutions targeting Chinese citizens cannot use cryptocurrencies. However, so far, there is no prohibition for Chinese citizens to own the digital money.
According to Chinese authorities, cryptocurrencies are often used in criminal activities including fraud, pyramid schemes, money laundering and others. Previously, China also raided large-scale Bitcoin mines.
Recently, the Chinese government carried out mining and crypto trading raids in Hebei Province. What is the reason? As before, Bitcoin mining is considered harmful to the environment and not in accordance with China's target of reducing emissions in anticipation of climate change.
