Bitcoin mining within China has returned according to a recent study. Thus, the superpower once again stands on the podium of the global hash rate.
A black market for mining?
According to a report published on May 17 by the Cambridge Centre for Alternative Finance, Bitcoin mining on Chinese soil has again become a reality and has taken on significant proportions.
Recall that in May last year, the Chinese government completely banned any cryptocurrency mining operations. It also became illegal to trade digital assets. As a result of the new restrictions, a mass migration of miners from the Middle Kingdom to such destinations as the United States, Kazakhstan, or Russia was recorded. While before the surprising decision, China was the global leader in mining, shortly after the decision the hash rate in the country fell to practically zero. Today this situation is completely changing, but is it really legal?
A podium reclaimed
The Cambridge Centre for Alternative Finance indicates that the first place in terms of BTC mining power is invariably occupied by the United States. They are responsible for 37.84% of the value of the indicator. Surprisingly, China jumped to the second place with a total output of 21.11%.
As the CCAF report states:
“This suggests that significant underground mining activity has developed in the country, which empirically confirms what the industry has long assumed.”
Despite the ban, mining activity is possible through virtual private networks (VPNs), which allow mines to be relocated to any other location in the world. However, as you can see, it is possible to detect the exact location of miners. This has been done not only by the authors of the report. The Chinese government, which has been trying to fight the underground mining industry lately, is following the same path. However, as you can see it is not able to eliminate it completely.
Results subject to error
Despite such high numbers, CCAF representatives indicate that they may be subject to significant error. However, this does not change the fact that bitcoin in China is still doing well. It is worth mentioning that the current podium is closed by Kazakhstan, with a result equal to 13.22%. It is followed by Canada (6.48%) and Russia (4.66%).