Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge. When he's not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
A recent report has confirmed that not only does China control a large percentage of Bitcoin’s worldwide hash rate, but most of it also comes from just one province.
China is usually referred to as the headquarters of Bitcoin mining in the world, an interesting feat especially when the government’s strong position against cryptocurrencies is considered. While the government has repeatedly expressed its support for blockchain technology, it has not accorded digital currencies the same level of attention and respect. Regardless of all this, China still controls about 67% of the entire hash rate of the Bitcoin network. The real clincher, however, is that according to a report by The Next Web’s Hard Fork, more than half of the hash rate is controlled by just one province.
Citing data from digital asset company CoinShares, the report states that the Sichuan province in the southwestern region of China controls 54% of the Bitcoin network’s worldwide hash rate. CoinShares gives further details:
“Out of the remaining 35 percent of miners, we estimate that 31 percent of global production is evenly split between Washington, New York, British Columbia, Alberta, Quebec, Newfoundland and Labrador, Iceland, Norway, Sweden, the Siberian Federal District of Russia, Kazakhstan, Georgia and Iran.”
The data from CoinShares doesn’t stop at Bitcoin hash rate control dominance but also gives an interesting insight into energy consumption. Bitcoin mining is very energy-intensive, which is quite easily one of the biggest arguments against the network, but the CoinShares information shows interesting progress. While it estimates that about $5.4 billion will be spent on energy purchases for Bitcoin mining in 2019, most of it is accounted for by renewable energy.
The data shows that 73% of all the energy used to mine Bitcoin all over the world is renewable, with the Sichuan province alone accounting for 48%. These statistics show that while mining still requires a lot of energy, it’s not as damaging on the environment as many have purported it to be.
It would also seem that regardless of the threat of a halving coming up next year, miners are still doubling down on Bitcoin production as hash rates have repeatedly hit new records this year. An upside to increased mining activity is that there could be more attention focused on research and development of renewable energy solutions, all thanks to Bitcoin. Coinshares writes:
“This could help turn loss-making renewable projects profitable and in time – as the industry matures and settles as permanent in the public eye – could act as a driver of new renewables developments in locations that were previously uneconomical.”
The CoinShares report also touches on Bitmain, easily the largest Bitcoin mining manufacturer in the world. Bitmain’s market share which was around 70% back in June, has now dropped to 66%. This is probably why Bitmain recently announced a few new strategies that it hopes will ensure it retains a controlling market share percentage, and take some pressure away from its customers by allowing them to spread payments instead of having to make one full payment for equipment they might need.