After the Chinese authorities banned the mining of Bitcoin in the country earlier this year, the United States replaced the former leader with a hash rate of more than one-third of the world and became the world’s main source of Bitcoin mining. The United States lags behind Kazakhstan and Russia. Most bitcoins are mined by large companies that operate their own data centers.
From 75% to 0%
According to data released by the Cambridge Alternative Finance Center, in September 2019, China controlled about 75% of the world’s Bitcoin computing power. The report stated Financial TimesAs the exchange rate of Bitcoin has soared in recent quarters, other countries have deployed large mining data centers, including the United States, Kazakhstan, and Russia.
As a result, China’s share fell to 44% in April this year, and after the authorities banned cryptocurrency mining in May, it dropped to zero (at least as far as legal mining is concerned). In September, China banned all illegal crypto-related activities in the country, which further reduced the attractiveness of mining Bitcoin or other cryptocurrencies there.
In contrast, the United States’ share of global computing power rose from 17% in April to 35% in August, while Kazakhstan’s share rose from 8% to 18% during the same period. Russia lags behind Kazakhstan.
“The closure of China is a good thing for the industry and for American miners,” said Fred Thiel, CEO of Marathon Digital Holdings, a company that mines and mints coins in Las Vegas. Financial Times“Overnight, the number of players pursuing the same limited number of coins decreased.”
In the United States, the acquisition of some crypto mining companies has even been suspended Coal-fired power plant Feed their farm. At the same time, in Kazakhstan, due to miners from China moving their equipment to this nearby state, the country is facing a power shortage. In order to get a share of the cryptocurrency cake, the government of Kazakhstan even passed a special crypto tax that will be implemented next year.
900 Bitcoins mined every day
Thiel estimates that approximately 900 Bitcoins are mined every day.Earlier this year it occurring Bitcoin mining consumes more electricity than countries where approximately 45 million people live, such as Argentina or Ukraine.
For obvious reasons, mining Bitcoin and other cryptocurrencies in countries with low energy prices makes the most economic sense. Unfortunately, the cheapest energy sources come from power plants fueled by coal and other fossil fuels that easily pollute the atmosphere.
So far, there is no detailed study on the carbon impact of cryptocurrency mining, but it should be quite tangible to say the least. At the same time, cryptocurrency miners are deploying new farms in Europe and North America, two regions that have long struggled with carbon dioxide emissions.
“Our current focus is to accelerate the construction of compliant mines in North America and Europe,” a representative of the mining machine manufacturer Yibang International Holdings told Reuters recent.