Chinese Miners Have Relocated, Bitcoin And Ethereum Hash Rate Normalizes

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To paraphrase a line from singer Prince, we should all party and mine like it is 1999. Yes, that would have been the thoughts of the North American crypto miners in the past few months. As the Chinese authorities cracked down on Bitcoin miners in the Middle Kingdom, those in the US and Canada saw their earnings skyrockets as the difficulty to mine Bitcoin (and Ethereum for that matter) dropped by 35 and 20 percent respectively.

At a certain point, Bitcoin miners were unearthing crypto at a $20,000 premium on the actual price because of this.

Normalizing rates

However, now that the Chinese companies who wanted to continue in the sector have slowly relocated and new players emerged in the US and Canada, the hash rates of both Bitcoin and Ethereum are normalizing again.

Bitcoin hash rate rebounds as major miners are coming back online https://t.co/J5122SOePJ #China #BitcoinRegulation #BitcoinMining #HashRate #btc

— Crypto Mak 🌐 (@crypto__mak) July 29, 2021

One of those companies, (formerly) Shenzhen-headquartered BIT Mining moved to Kazakhstan for example, where it is now almost at the same level of operations as it previously had in its mining facilities in Sichuan.

Hash rate spreads globally

With that, Bitcoin critics like Nouriel Roubini and Paul Krugman have one less weapon against cryptocurrencies as their previous argument that China could set the price if it wanted to, is no longer valid. Even though the Chinese are still seen as the world leaders when it comes to Bitcoin’s hash rate (even after the crackdown), their concentration of the global total had already fallen from more than 75% to as low as 46% by April of this year.

$BTC has become more decentralized in the past year.

According to @blockchain, hash rate distribution is increasingly favoring small, unknown miners.

The #hashrate distribution trend is in evidence ever since the March 2020 crash, and this year has gathered pace#Bitcoin pic.twitter.com/NaXRshw7XN

— Zionodes (@ZionodesOC) July 23, 2021

It is anyone’s guess where the global percentages of Bitcoin’s computing power sit at this point in time, but it is clear that the spread is more global than ever.