The Bitcoin mining process is known to cost a lot of hardware and energy resources. So when it comes to profitability, electricity costs play a crucial role. This is one of the reasons why many Bitcoin mining operators have settled in China. For a long time, this business area was not welcomed in China and was on a list of industries that may need to be banned. Mining was removed from this list just a month ago, which has given some relief to some Bitcoin fans. A new statistic from “CoinShares” now shows how “centralized” mining actually is in China.
Bitcoin mining share in China continues to grow
China-based Bitcoin Mining operators hold 66% of global hashing power, according to Coinshares Wealth Management. In June it was “only” 60%. This shows a further increase in the share and is the highest since the start of the statistics 2 years ago, 2017.
Chris Bendiksen, Coinshares ‘Head of Research, sees the reason for the increase in Chinese miners’ competitive advantage in terms of hardware. The processors they use should be more powerful and thus provide more hashing power.
“This is beneficial to the Chinese mining industry. If you are the first to increase your share of the hashrate and can do it ahead of your competitors, it is generally a good thing.”
$ 4.7 billion industry currently
At a current price of just under $ 7,200, Bitcoin Mining is an industry that “produces” $ 4.7 billion worth of Bitcoin annually.
The major mining regions are located in the Chinese provinces of Yunnan, Xinjiang, Inner Mongolia and Sichuan, the latter accounting for more than half of the global hashrates, according to CoinShares. Other centers are spread from the United States to Russia and Kazakhstan.
Chinese companies such as Bitmain and MicroBT are among the world’s largest manufacturers of Bitcoin mining devices. Another, Canaan (CAN.O), launched an $ 90 million IPO in November, showing investors’ interest in investing in the mining industry.