Bitcoin Mining in China Is “Reviving”?

(Dan Tri) - According to Reuters, over the past 2 years, Bitcoin mining activities have returned in Xinjiang and Sichuan provinces.

Bitcoin mining in China is showing signs of “resurgence”. According to October Hashrate Index data, China now accounts for about 14% of the total global Bitcoin mining power, ranking third in the world , after the US and Kazakhstan. Some experts believe the actual rate could even be as high as 15-20%.

Canaan - a leading manufacturer of Bitcoin mining equipment - recorded a sharp increase in revenue from the Chinese market: From 2.8% in 2022 to 30% in 2023 and in the second quarter of this year it exceeded 50%, according to industry sources.

Reuters reported that in the past two years, Bitcoin mining has re-emerged in Xinjiang and Sichuan. These areas have large surpluses of electricity but are difficult to transmit to coastal cities, making them ideal locations for mining farms.

According to CoinTelegraph, Bitcoin mining activities in China are increasing again due to many reasons.

First, provinces like Xinjiang and Sichuan have surplus or cheap electricity from coal, wind and hydropower, which is effectively used for mining rather than being wasted.

Second, many data centers grow beyond actual demand, and when operating demand is low, facility owners rent out space and machine capacity to Bitcoin miners, facilitating mining.

Third, the sharp increase in Bitcoin prices in recent years has made mining profits more attractive, attracting investors and miners back.

Bitcoin mining in China is "reviving" (Photo: Reuters).

China's policy towards cryptocurrencies is also shifting towards controlled experimentation, moving from an outright ban to accepting some activities but under strict regulatory control.

Hong Kong (China) has started allowing stablecoins (stable cryptocurrencies) effective from August. Meanwhile, in the mainland, China is also testing a stable cryptocurrency pegged to the yuan and promoting the central bank digital currency e-CNY, integrating it into retail payments, public services and cross-border pilot programs.

Before 2021, China dominated the global Bitcoin mining market. According to data from the Cambridge Bitcoin Electricity Consumption Index, Chinese miners accounted for about 65% of Bitcoin's computing power in 2020, making the country the world's leading Bitcoin mining hub.

However, things changed rapidly in 2021. In September 2021, the People's Bank of China declared all cryptocurrency transactions illegal and confirmed a nationwide ban on mining.

Many mining facilities in China were subsequently forced to close or move to countries such as the US, Kazakhstan, and Russia. However, global electricity consumption for Bitcoin mining has not decreased, but has continued to increase due to the mining boom in other countries. Annual electricity consumption for Bitcoin mining has increased from 89 TWh in 2021 to about 121 TWh in 2023.

Source: https://dantri.com.vn/kinh-doanh/khai-thac-bitcoin-tai-trung-quoc-dang-hoi-sinh-20251205134445039.htm