The Bitcoin Network has Recovered from the China Mining Ban
Following months of recovery, the Bitcoin network's total hash rate has once again reached its all-time high
Following months of recovery, the Bitcoin network's total hash rate has once again reached its all-time high of 180 million terahashes per second (TH/s). Bitcoin's hash rate had previously topped 180 million TH/s in May 2021, prior to the Chinese government's ban on crypto mining within the country.
A Proof-of-Work blockchain's hash rate is a measurement of the total combined computational power used to mine and process transactions on the blockchain. Generally, blockchains with higher hash rates are considered more secure, since 51% attacks require more computing power to execute as the blockchain's hash rate increases.
Before China banned crypto mining, it dominated the space. Following the ban in May, Bitcoin's hash rate decreased rapidly, bottoming out in July around 85 million TH/s. The Financial Times reports that roughly 2 million mining rigs went offline in China. Since then, former Chinese mining rigs have been coming online all over the world.
Russia got the most Chinese rigs, with over 200,000 now operating in the country. The United States and Kazakhstan were second and third, getting about 88,000 rigs each. The Financial Times report noted that older, less efficient, mining rigs were more likely to end up in developing nations, while newer rigs mostly ended up in the United States.
Kazakhstan was a popular destination for ex-Chinese miners because it has cheap electricity and is close to China. Kazakhstan has poor energy infrastructure and a population of only 19 million, so the rapid influx in Bitcoin mining caused severe electricity shortages throughout the country, leading to electricity rationing in September. Since rationing began, large mining operations have been leaving Kazakhstan, despite the nation's insistence that it will not restrict power to legal mining operations.
Almost 700,000 of the original 2 million Chinese mining rigs are believed to still be offline.