Bitrabo Editorial
Ki Young Ju, founder of CryptoQuant, highlights a shift in Bitcoin mining towards the United States, although Chinese miners still hold a significant presence. In a tweet on X, Ju indicates that American mining pools are increasingly capturing market share from their Chinese counterparts, evident from the Bitcoin hash rate data.
Shift in Bitcoin Hashrate to the US Post-China Ban
As of September 23, Chinese mining pools held 55% of the Bitcoin hash rate, while those in the US accounted for 40%. This concentration means that together, China and the US control 95% of Bitcoin mining, posing risks to the operation and security of the blockchain.
Bitcoin relies on decentralized miners who pool their computing resources (hash rate) to compete for block rewards. These miners invest in equipment and cover operating expenses.
The network rewards the successful miner or pool with 3.125 BTC and transaction fees approximately every 10 minutes, maintaining both security and decentralization.
The noted shift in hash rate mirrors China’s crackdown on cryptocurrency mining that began in May 2021. The Chinese government cited concerns over financial crime and capital flight as reasons for the ban on all crypto-related activities.
Officials argued that cryptocurrencies jeopardized economic stability, leading to widespread shutdowns of mining operations across the country.
Many miners from China relocated, with a significant number moving to the US and Kazakhstan. While there are still some mining activities in China, the more supportive regulatory environment in the US has led to a flourishing crypto mining scene.
Supportive Regulations and Trump Backs Crypto Mining
In the US, Bitcoin mining has become institutionalized, with major players like Marathon Digital and Riot Platforms mining substantial amounts of BTC each year.
Additionally, more independent miners are joining US-based mining pools. As noted by Mempool.space, Foundry USA stands out as the leading mining pool, contributing over 30% of the hash rate.
In June, former President Donald Trump, who is running for the Republican nomination, met with crypto mining leaders in Florida and expressed his intention, if elected, to support fair treatment of the sector.