The United States has overtaken China — the longtime home to most crypto mining activity in the world — as the world’s biggest source of bitcoin mining, according to new data published Wednesday by Cambridge University.
China’s share of the global Bitcoin hashrate — an industry term used to describe the computational power of all miners — fell from about 44 percent in May to zero percent in July, after authorities in Beijing called for a crackdown on Bitcoin mining, sparking an industry exodus.
At the same time, The US’ share of Bitcoin’s hash rate rose from just 17.8 percent in May to 35.4 percent in August, a rise of more than 66 percent, according to the data from the Cambridge Centre for Alternative Finance.
Bitcoin mining is the energy-intensive process that both produces new Bitcoins while processing transactions made with the existing supply. As the supply of Bitcoins grows, it becomes more energy-intensive to mine new coins.
The energy demands of mining has become a major point of criticism for the crypto, with even some of its biggest supporters like Tesla CEO Elon Musk calling out its environmental impact. Proponents, though, argue that Bitcoin miners are tapping new forms of renewable energy, including geothermal power, to drive growth.
The new data marks a massive shakeup in the increasingly important and lucrative world of Bitcoin mining.
In August of last year, the US was responsible for just 4.2 percent of the world’s Bitcoin mining activity — marking a year-over-year increase of more than 157 percent — while China at that point dominated the sector with nearly 67 percent of global hash rate.
The price of Bitcoin and other cryptocurrencies skyrocketed earlier this year, with Bitcoin peaking at almost $65,000 per coin in April, spurring governments to take a hard look at the industry.
China’s State Council announced a ban on cryptocurrency mining and trading in May, citing environmental concerns as well as risks to the country’s financial system.
The decision forced the country’s crypto miners to pack up shop and search for cheap energy sources and more friendly regulations elsewhere, and many landed on the US.
“The China shutdown has been great for the industry and US miners,” said Fred Thiel, CEO of Marathon Digital Holdings, a Las Vegas-based crypto mining company, according to the Financial Times.
“Overnight, fewer players were going after the same finite number of coins,” he told the outlet.
Still, the US is competing with other countries that are now trying to grab a piece of the quickly growing industry.
Kazakhstan, for example, has become a Bitcoin mining heavyweight.
The country boasted almost 22 percent of global Bitcoin hash rate as of August, according to Cambridge’s data. That’s up from just 11.9 percent in May.