U.S. overtakes China in becoming world’s largest bitcoin mining centre

• U.S. accounts for 35.4% of the hash rate—share of the power of computers connected to the global bitcoin network.

• China’s hash rate has gone down to zero by July from 44% in May.

The United States has become the largest bitcoin mining centre of the world overtaking China as the crackdown on bitcoin trading and mining by Chinese regulators have forced miners to close shop.

Data published by Britain’s Cambridge Centre for Alternative Finance on Wednesday showed that at the end of August, U.S. accounts for 35.4% of the hash rate—share of the power of computers connected to the global bitcoin network—which is the largest in the world.

The hash rate of U.S. experienced an increase of 428% from September last year. Kazakhstan has the second largest share of bitcoin mining in the world, followed by Russia.

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Chinese crackdown

Data showed that China’s hash rate has gone down to zero by July from 44% in May, which was as much as 75% in 2019. The crackdown by China’s State Council on bitcoin traders in late May resulted in the downfall of mining in the country. Many miners have shifted to North America and Central Asia.

For creating or “mining” bitcoin, large amount of electricity is used by high-powered computers in different parts of the world, trying to solve complex mathematical puzzles.

Unlike Chinese authorities who announced strict rules for bitcoin mining and trading last month, authorities elsewhere in the world have been quite tolerant.

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Benefits offered in U.S.

In U.S., states like Texas offer lowest energy prices in the world which is a great advantage to miners. The U.S. also offers many renewable power sources.

The share of Texas in renewable is constantly increasing, with 20% of its power coming from wind as of 2019 while Washington state has many hydropowered mining farms.

Kazakhstan which has world’s second largest share of bitcoin mining accounts for 18.1% of all crypto mining. The country provides cheap and abundant energy due to the coal mines but leads to high carbon dioxide emissions.

Picture Credits: Reuters