US becomes largest bitcoin mining centre as China ban bites

Photo by Andre Francois on Unsplash

The United States has overtaken China to account for the largest share of the world’s bitcoin mining, data published on Wednesday by Britain’s Cambridge Centre for Alternative Finance showed.

The figures demonstrate the impact of a crackdown on bitcoin trading and mining launched by China’s State Council, or cabinet, in late May, targeting financial risks, devastating the industry and causing miners to shut up shop or move overseas.

China’s share of the power of computers connected to the global bitcoin network, known as the “hash rate”, had fallen to zero by July from 44% in May, and from as much as 75% in 2019, the data showed.

Miners elsewhere have taken up the slack, with mining rig manufacturers shifting their attention to North America and Central Asia, and larger Chinese miners moving as well, though this process is fraught with logistical difficulties.

As a result, the United States now accounts for the largest share of mining, some 35.4% of the global hash rate as of the end of August, followed by Kazakhstan and Russia, according to the data.

Bitcoin is created or “mined” by high-powered computers usually at data centres in different parts of the world, competing to solve complex mathematical puzzles in a process that makes intensive use of electricity.

Authorities elsewhere are more tolerant or even welcoming of bitcoin mining, while Chinese authorities announced even tougher rules for bitcoin mining and trading last month.

“Our current focus is accelerating the construction of compliant mining farms in North America and Europe,” a representative for mining rig maker Ebang International Holdings told Reuters after the latest crackdown.

But industry players remain bruised.

“As a veteran who witnessed the industry’s birth in China, I feel the situation today is lamentable,” said Mao Shihang, founder of F2Pool, once the world’s biggest bitcoin mining pool, and co-founder of Cobo, a Singapore-headquartered crypto asset manager and custodian.

“China is losing its share of computing power … the industry’s centre of gravity is shifting to the United States,” he said, speaking before the Cambridge data was published.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.