The United States of America has been the second-biggest mining destination on Earth for a long time now, and even before Beijing’s sudden crackdown China knew that its grip was slipping. Fred Thiel of Marathon Digital expects most new miners to relocate north of our border in search of renewables or gas supplemented by renewable energy credits.
China has had a big impact on the bitcoin mining industry. As of April 2021, China is only responsible for 17% of all bitcoin miners in the world and it was once home to more than half that share just 5 years ago.
It's not surprising though considering they have been fast becoming one of the most strict countries when it comes to cryptocurrency regulation with Beijing instituting bans from things like ICOs or crypto exchanges as well as outlawing any trading between currencies pegged at different rates (that includes cryptocurrencies).
With such heavy restrictions put into place, many Chinese Bitcoin Miners are fleeing their homeland looking for greener pastures elsewhere. Some think this could be because new data shows American cities now account for some 151% increase in these numbers over.
Darin Feinstein, founder of Blockcap and Core Scientific has noticed an uptick in mining operations looking to relocate from other countries such as China or Russia due to the recent growth in infrastructure for North America which now includes Canada and Mexico.
The Chinese crypto mining ban has been a focal point of the Bitcoin industry. The Cambridge dataset revealed that before China's decision to halt large-scale bitcoin mining, it accounted for 46% of total world hashrate at its peak in April 2019 - but by September 2019 just months later this percentage had declined sharply from 75%. With many miners now packing up their bags and leaving town as we speak, there remains no telling how much lower those numbers are today.
America's Rising Dominance in Mining Area
The U.S has quietly been building up its hosting capacity for years and it appears to be paying off as many bitcoin miners are coming over from other countries looking for cheaper electricity costs than what they had back home - just one of the reasons why American dominance is inevitable.
However, the big mining operators found themselves being forced to liquidate their equipment at rock-bottom prices. As cryptocurrencies crashed in late 2017 and entered a multiyear crypto winter, there was little demand for bitcoin farms - U.S.-based miners saw an opportunity and took advantage of cheap money from investors by building up the industry on home turf.
“The large publicly traded companies were able to raise capital go make big purchases," said Mike Colyer CEO of digital currency company Foundry which helped bring over 300 million dollars worth of mining hardware into North America."
Impact on Environment
In midst of all this, Thiel expects most new miners relocating to North America to be powered by renewables, or gas that is offset by renewable energy credits
With miners moving to the U.S., Canada, and Russia in droves recently with bitcoin’s price going down a bit, it will mean much lower carbon intensity for cryptocurrency as well.
Nic Carter of Castle Island Ventures points out that while some US mining isn't wholly renewable yet there are things like solar panels on-site at many facilities which demonstrates they're making strides towards becoming so over time"
So folks, what's your take on America's Crypto mining dominance? Share your thoughts in comments section below
