Jakarta, CNBC Indonesia – In several world countries such as China and Iran, local governments have begun to tighten the rules for mining cryptocurrencies, especially Bitcoin. This prohibition is a limitation for crypto asset mining activities, in addition there are issues related to monetary authorities to the waste of energy caused by mining activities.
This makes the world ask where the crypto investors are going, considering that countries like China are the songs of half of the world’s Bitcoin miners. A recent data from the University of Cambridge suggests that they may be heading to the United States (US).
Cambridge noted that before China’s mining ban began, the country accounted for 46% of the world’s total hashrate, the industry term used to describe bitcoin mining activities. That’s a sharp drop from 75.5% in September 2019, and the percentage is likely much lower given the exodus now underway.
“500,000 Chinese mining rigs were previously looking for homes in the U.S.,” said Fred Thiel of Marathon Digital.
“If they are deployed, that means North America will have nearly 40% of the global hashrate by the end of 2022.”
The US is quickly becoming the new darling of the bitcoin mining world. The country is the second largest mining destination in the world, accounting for nearly 17% of all the world’s bitcoin miners as of April 2021. This number is an increase of 151% from September 2020.
“Over the past 18 months, we have seen serious mining infrastructure growth in the US,” said Darin Feinstein, founder of Blockcap and Core Scientific.
“We’ve seen a massive increase in mining operations looking to move to North America, mostly in the US.”
Additionally, companies such as North American crypto mining operator Core Scientific are also currently continuing to build hosting spaces to increase mining capacity.
“Most of the new equipment produced from May 2020 to December 2020 was shipped to the US and Canada,” he said.
The US itself is said to have been preparing the mining infrastructure for years. Before Bitcoin miners actually started coming to America, Uncle Sam’s country companies had been trying to bet on the cryptocurrency market.
When Bitcoin crashed in late 2017, there wasn’t much demand for big Bitcoin farms. US mining operators saw this opportunity and used the falling price of Bitcoin mining tools to build a new mining ecosystem.
“Big, publicly traded miners are able to raise capital to make big purchases,” said Mike Colyer, CEO of digital currency firm Foundry.
Not only that, mining in the US has also increased due to the disbursement of the pandemic stimulus. With the restrictions on economic activity, stimulus funds are used to invest in this cryptocurrency.
“All the printing of money during the pandemic means more capital needs to be mobilized,” explains bitcoin mining engineer Brandon Arvanaghi.
“People are looking for a place to park their money. The desire for large-scale investments has never been this great. Much of it is most likely found in bitcoin mining operations in places outside of China,” Arvanaghi continued.
(hps / hps)
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