Bitcoin (BTC) mining continues to thrive in China despite the government banning the practice.
China was once the world’s biggest cryptocurrency mining hub, accounting for between 65% to 75% of the total processing power of the Bitcoin network. But the country’s share of global Bitcoin mining capacity plummeted to zero last summer, according to Cambridge University data, after authorities banned the practice nationwide.
The government ban caused several Bitcoin miners to flee China for other countries, including Canada. However, several underground mining operations have since emerged in China, with miners working around Beijing’s ban and regulations.
Now, new research from the Cambridge Centre for Alternative Finance shows that Chinese Bitcoin mining activity has quickly rebounded. By September of last year, China made up just over 22% of the total Bitcoin mining market, second only to the U.S., the data shows.
China’s government has repeatedly issued warnings about the dangers of cryptocurrency. The government’s main concern appears to be the large amount of energy that Bitcoin mining consumes.
China was dealing with a multi-month energy shortage last year, which led to numerous power cuts, and prompted the national ban on Bitcoin mining.
But now, a resurgence of Bitcoin production in China has catapulted the country to the second-largest destination for people hoping to find new digital currencies. There’s still two million Bitcoins left to be mined.
The price of Bitcoin has fallen 40% this year to currently trade at $29,150 U.S.
