The United States has overtaken China, long home to most of the world’s crypto mining activity, as the world’s largest source of Bitcoin mining, according to new data released Wednesday by the University of Cambridge.
China’s share of bitcoin’s global hashrate, an industry term used to describe the computational power of all miners, fell from around 44 percent in May to zero percent in July, after Beijing authorities called for a crackdown on bitcoin mining, prompting an exodus from the industry.
At the same time, the US share of the bitcoin hash rate rose from just 17.8% in May to 35.4% in August, an increase of more than 66%, according to data from the center Cambridge Alternative Finance.
Bitcoin mining is an energy-intensive process that produces new bitcoins while processing transactions made with the existing supply. As the supply of bitcoins grows, it becomes more energy intensive to mine new coins.
The energy demands of mining has become a major point of criticism for the crypto, with even some of its biggest supporters like Tesla CEO Elon Musk calling out its environmental impact. Proponents, though, argue that Bitcoin miners are tapping new forms of renewable energy, including geothermal power, to drive growth.
The new data marks a big change in the increasingly important and lucrative world of bitcoin mining.
As of August last year, the United States was responsible for just 4.2% of the world’s bitcoin mining activity, marking a year-over-year increase of more than 157%, while China dominated the sector at the time with almost 67%. of the global hash rate.
The price of Bitcoin and other cryptocurrencies skyrocketed earlier this year, with Bitcoin peaking at almost $65,000 per coin in April, spurring governments to take a hard look at the industry.
China’s state council announced a ban on cryptocurrency mining and trading in May, citing environmental concerns and risks to the country’s financial system.
The decision forced the country’s crypto miners to pack up and look elsewhere for cheap energy sources and friendlier regulations, with many landing in the US. uu.
“The China shutdown has been great for the industry and US miners,” said Fred Thiel, CEO of Marathon Digital Holdings, a Las Vegas-based crypto mining company, according to the Financial Times.
“overnight, fewer players were chasing the same finite number of coins,” he told the outlet.
Still, the US is competing with other countries that are now trying to grab a piece of the fast-growing industry.
Kazakhstan, for example, has become a Bitcoin mining heavyweight.
The country accounted for nearly 22 percent of the global bitcoin hash rate as of August, according to Cambridge data. that’s an increase from just 11.9 percent in May.
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