Chinese authorities are targeting Bitcoin and shutting down their bitcoin mining plants due to the environmental effect of mining. Bitcoin’s Hashrate is already down by 40% from its peak. This could be a great opportunity for stealth and other miners to get in the game.
China provides 65% to 75% of the total global mining capacity. It is estimated that 90% of Chinese mining facilities are closed due to recent China’s crackdown. Bitcoin mining is nothing like exploring gold or any other precious metals. It solves complex math problems to generate a new Bitcoin and then verify its transaction information to make it secure and trustworthy. 72 Terawatts of power is consumed to mine a Bitcoin and chemicals from mining have a drastic impact on the environment.
Miners get a reward in form of Bitcoin for providing processing power. The reward for mining remains constant. A low hashrate means fewer miners who will get a higher reward and vice versa.
Due to china’s crackdown, there’s a gap to fill for miners. Most of China’s mining corporations are planning to move towards countries like Kazakistan, United States, Canada, and Russia. Stealth miners(who don’t reveal their identity) are back in town since 2019. They take full advantage of the situation and provide a hashrate of 7% to 9% of the total mining capacity.
Crypto experts say that due to the Chinese ban other miner’s share of the network will increase and it will make Bitcoin mining much more lucrative. The lucrative mining market will encourage other miners across the globe. However, this may cause a delay in bitcoin transactions. Kevin Zhang told CNBC:
As more hashrate falls off the network, the difficulty will adjust downwards, and the hashrate that remains active on the network will receive more for their proportional share of the mining rewards.
Let’s see how miners across the globe avail this opportunity.