Jakarta, CNBC Indonesia – China has long been home to more than half of the world’s Bitcoin miners. But now, the Bamboo Curtain State wants them out of the country as soon as possible.
In May, the government called for a crackdown on Bitcoin mining and trading. This triggers, so-called crypto miners (cryptocurrency) “great mining migration” in which 50% more are ‘expelled’ from China.
Although 2021 data for the global distribution of mining power is not yet available, previous estimates suggest 65% to 75% of the world’s Bitcoin mining takes place in China. Most of the mining takes place in China’s four provinces, namely Xinjiang, Inner Mongolia, Sichuan and Yunnan.
Sichuan and Yunnan are centers of hydroelectric power, renewable energy mecca. While Xinjiang and Inner Mongolia are home to many of China’s coal-fired power plants.
Miner withdrawals have begun in Inner Mongolia. After failing to meet Beijing’s climate targets, provincial leaders decided to give Bitcoin miners two months to clean up and explicitly blamed them for the failure.
Castle Island Ventures founding partner Nic Carter said while it’s not entirely clear how China will handle its next move, it’s likely this action will continue. “It looks like we’re moving from (China’s) policy statements to actual implementation in a relatively short period of time,” he said CNBC International.
The way to see how miner exodus is measured is by looking at the hashrate. It is an industry term used to describe the computing power of all the miners on the Bitcoin network.
“Given the drop in hashrate, it appears that installations are shutting down across the country,” continued Carter, who also thinks that perhaps 50% to 60% of all Bitcoin hashrates will eventually leave China.