United States Surpasses China as World's Largest Bitcoin Mining Hub with 75.4% Hashrate

The United States has now become the world's largest Bitcoin mining hub, accounting for 75.4% of the reported hashrate. This shift in dominance has raised questions about China's potential response, given its historical control over a significant portion of the global Bitcoin hashrate and its long-standing anti-crypto stance.

China's crackdown on cryptocurrency mining began in 2019 when the National Development and Reform Commission signaled its intention to prohibit the industry. This crackdown intensified in 2021 when the government declared all crypto-related transactions illegal, further solidifying the ban. However, despite these measures, mining activity has not completely ceased within the region. In July 2024, it was reported that the hashrate within China currently accounts for approximately 15% of the global total.

China's geographical and technological advantages, particularly in the production of crypto mining hardware, give it a potential edge should it decide to revive its mining sector. The ongoing tariff dispute between the United States and China adds another layer of uncertainty to the long-term cost efficiency of US mining operations.

According to Nic Puckrin, Co-founder of the Coin Bureau, the combination of trade friction and the US’s invigorated push for crypto dominance might be sufficient to make China reconsider its position. However, China has strategies beyond restarting its Bitcoin mining industry to undermine the United States’ dominance.

China's efforts to create a digital yuan are partly driven by its desire to de-dollarize its economy and lessen its dependence on the US dollar. China's activity in other areas of international trade already proves how nuanced its policy changes tend to be.

China's stance on crypto has already proven somewhat contradictory. These discrepancies may fuel the belief that the country might just be willing to revert—or at least soften—its total ban on mining.

According to Puckrin’s analysis of these indicators, China’s “shadow crypto economy” is projected to expand this year, which could result in a reassertion of its power. This resurgence would be primarily in response to de-dollarization efforts, rather than a reaction to US dominance in mining.

It will remain crucial to interpret China’s intentions, especially regarding cryptocurrency, by observing its actions rather than relying solely on its official statements.