BTC Hashrate Is Making Recovery After China’s Mining Crackdown
Bitcoin’s hash rate rose almost 5% overnight, according to Ycharts. Now 104 EH/s back the network, indicating a slow recovery from China’s crackdown that put a stop to BTC mining in China’s key mining provinces.
Last week the BTC hash rate dropped by 17% in the aftermath of a government issued shutdown order in Sichuan, a province popular for mining operations due to an excess of cheap hydroelectric power. 26 mining farms were forced to shut down.
Since then many Chinese miners have relocated to North America and Kazakhstan, which has allowed Bitcoin to recover, but regardless, the network’s hash rate is still 1.68% lower than this time last year.
According to Chinese blockchain journalist Colin Wu, it will be difficult for Bitcoin hashrate to return to its former level of 130E in half a year, unless China loosens the policy.
The hashrate of Bitcoin began to slowly rise, and some Chinese miners' machines began to land in Kazakhstan and North America, but it is expected that it will be difficult to return to 130E in half a year, unless China's policy is loosened. pic.twitter.com/EQp29iumOz
Since Wu’s tweet, Bitmain-owned Chinese mining farm Antpool has dropped by 1200 PH/s (quadrillion hashes per second), conceding top place to another Chinese mining pool called ViaBTC.
According to Wu, we shouldn’t underestimate China’s influence on the crypto industry, as the numbers still highlight an inextricable link between crypto and Chinese policy decisions.
Some people ask why pay attention to China 1, World's mining and exchanges are dominated by Chinese. Chinese retail investors have too much money. 2, China’s policies are severe, but HK has progress. If there is any loosening in Beijing, the advantage is unimaginable.
The current Chinese crackdown started around mid-May, when the country’s central bank’s 2017 ban on financial companies engaging in crypto transactions received support from three Chinese payments associations. Following the announcement, the price of Bitcoin sank 30% from over $40k to $30,415, although it’s probably not the only factor affecting the market crash.
Despite many efforts, Bitcoin is far from recovering to its former all-time high of $64,800 in mid-April. It currently trades at $32,925.
