The Bitcoin network’s hashrate has slowed down following the latest crackdown on mining activities in China’s Sichuan province.
China’s Sichuan province cut power to 26 cryptocurrency mining farms and other smaller crypto miners operating in the region last week. The move has resulted in the Bitcoin network’s hashrate dropping by over 17% in the past few days.
Historically, a decline in the network hashrate affects Bitcoin’s price negatively. Since the latest crackdown on crypto mining activities in China, Bitcoin’s price has dropped by over 5%, and it is now trading just above the $35k mark on various cryptocurrency exchanges.
Data obtained from BTC.com showed that some mining farms were hit harder than others by the Sichuan province’s latest move to ban crypto mining activities. Mining pool BTC.TOP lost its place as the 11th largest cryptocurrency mining pool and now occupies the 15th place. The ban saw BTC.TOP lose over 50% of its mining hashrate. Antpool.com maintains its position as the leading Bitcoin mining farm but lost 14% of its hashrate over the past few days.
The Chinese government has been cracking down on cryptocurrency mining activities in recent months. If the ban continues, the crypto mining space would need to be restructured. Currently, China accounts for 65% of all the computational power backing the Bitcoin blockchain.
Other countries will be looking to take advantage of the situation in China. Already, the Mayor of Miami has revealed that he is working to lower the cost of electricity to entice Bitcoin miners displaced from China and other places to move to Florida.
Cryptocurrency mining farms are also looking at countries like Argentina, where energy costs are low. Similar to how Chinese crypto exchanges like Binance and Huobi set up shop in other countries, the mining farms could move their operations to more accommodating countries if China’s crackdown continues.
