Despite imposing a blanket ban on cryptocurrencies in 2021, China continues to exert a significant influence over the Bitcoin mining landscape. According to CryptoQuant CEO Ki Young Ju, Chinese mining pools still control over 55% of the global Bitcoin network’s hashrate.
While this dominance is slowly shifting towards US mining firms, China’s surprising hold on the network is a testament to the resilience of its mining industry. The country’s ban on Bitcoin mining and trading, implemented in 2021, has not deterred Chinese miners from finding ways to participate in the global network.
China’s Evolving Stance on Crypto
China’s stance on cryptocurrencies is not static. The country is planning to amend its Anti-Money Laundering (AML) regulations in 2025 to include cryptocurrency transactions. This move reflects a growing recognition of the need for stricter oversight in the face of increasing cryptocurrency adoption.
While the broad scope of the AML law makes it challenging to address all aspects of cryptocurrency regulation, the amendments aim to establish a framework for curbing money laundering activities associated with cryptocurrencies.
Bitcoin Miner Revenue Under Pressure
The decline in Bitcoin miner revenue in August 2024 highlights the challenges faced by miners worldwide. Despite a slight increase compared to August 2023, the revenue for the month was the lowest in a year. This downturn can be attributed to factors such as the price volatility of Bitcoin and increased competition within the mining industry.
The Future of Bitcoin Mining
The continued dominance of Chinese mining pools, despite the ban, raises questions about the future of Bitcoin mining. As the industry evolves and regulations tighten, it remains to be seen whether China will maintain its position or if other regions will gain a larger share of the hashrate.
The upcoming amendments to China’s AML regulations could also have a significant impact on the country’s crypto mining industry. If the regulations are implemented strictly, it could lead to increased scrutiny of Chinese mining operations and potentially limit their ability to participate in the global Bitcoin network.
In conclusion, China’s influence on the Bitcoin mining landscape remains substantial, even after the imposition of a ban. As the industry continues to evolve and regulations change, the balance of power between different regions could shift, shaping the future of Bitcoin mining.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
