Not that long ago, China was the dominant power in global bitcoin mining, a position that presented the cryptoworld with a profound threat: if Beijing wanted it could simply take control over a majority of global mining rigs and launch a "51% attack", in the process nuking the blockchain and effectively destroying the world's greatest monetary experiment overnight.
However, in the span of just a few short months, back in May, China's State Council - which was focused on marketing its disastrous digital yuan and hoped to eliminate all competition - expelled its domestic bitcoin mining industry citing environmental and financial concerns, under the pretext that bitcoin miners were using up too much dirty electricity (a rather hypocritical take for a country that has emerged as the world's largest polluter) in a move that many have said will be remembered as the "single greatest geopolitical mistake of the 21st century" (it would subsequently proceed to ban all bitcoin activity in yet another catastrophic mistake by the country's oligarchs). And with China voluntarily cedeing its sole veto control over bitcoin, we predicted that the outcome would be an extremely bullish one for the crypto sector especially since the ESG criticism against bitcoin would gradually fade away; indeed, with bitcoin now trading just shy of all time highs, we were right.
The winner? The United States, which was just a minor player in recent years and has since blossomed into the world's largest bitcoin mining hub.
In just two months, the US overtook China as the world's biggest source of bitcoin mining after Beijing banned crypto mining this year, new data have revealed. As shown above, China's share of the global hashrate — the computational power required to create bitcoin — fell from 44 per cent to zero between May and July. The country accounted for three-quarters of the global hashrate in 2019.
The US share of the global hashrate increased from 17 per cent in April to 35 per in August, while Kazakhstan rose 10 percentage points to 18 per cent in the same period.