China is increasingly mining Bitcoin after the hashrate fell to zero last year, but it seems that it has returned quite suddenly so let’s read more today in our latest bitcoin news.
Last week, Cambridge Univerisity’s Centre for Alternative Finance released an update to its Bitcoin Electricity Consumption Index which in part looks to uncover and share the geographic location breakdown of BTC miners across the world. The previous update showed that the Chinese share of mining went from 34% In June 2021 to 0.0% in July 2021 after a ban on mining in the country. Last week’s update showed that china’s share of mining went from 0.0% in August 2021 to 22.3% in September 2021.
China is increasingly mining BTC after it banned BTC mining back in 2021 and showed up in the data so by July, there were no miners mining in China and there were non in August as well. In September almost all the miners who left came back. The bulk of the mining operations is not just a handful of hobbyists that played around. Most miners are entangled in commercial operations and pay triple net leases for the warehouse space and depend on the fancy power purchase agreements for the electricity.
The reason the data look like this is because of the data collection method by the CCAF. The CCAF partnered with BTC mining pools to collect geolocation information on mining facilities based on IP addresses which is where the issue lies and CCAF warned. It is no secret in the industry that miners in certain locations use virtual private networks or proxy servers to hide their IP addresses and obfuscate their location. This behavior could distort the sample and result in the overestimation of a hashrate in some provinces or countries.
As recently reported, China is contributing a huge chunk of the world’s BTC mining operations despite the ban from a year ago as per the Cambridge Centre for Alternative Finance. The report shows that from September 2021 to January this year, China’s contribution to the BTC mining network was second to the one of the US as per the CCAF’s BTC Electricity Consumption Index which maps the mining activity around the world based on the data from the partnering pools, showing the Bitcoin mining survived the ban in China.
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