After officials in China’s Sichuan province shut down 26 mining rigs, the amount of computing power underpinning Bitcoin fell by 16.94 percent in the last 24 hours.
Bitcoin’s price may be harmed by falling hashrates. Outages in Xinjiang reduced Bitcoin’s hashrate by 30% in April, contributing to a $10,000 drop in the price.
Bitcoin declined 5.71 percent to $34,205 this time. That’s a smaller drop than many of the top 20 cryptocurrencies by market capitalization.
The future of Bitcoin mining in China appears to be dismal. It’s a major deal for Bitcoin; according to some estimates, China provides around 65 percent of the processing power that powers the Bitcoin network.
Many miners travel to Xinjiang for the rest of the year, where the cold temperature cools off the miners who rely on coal-powered energy sources. This saves money on electricity.
But that is no longer the case. On June 9, Xinjiang issued one of the multiple closure orders around the country, ordering the shutdown of several crypto mining firms.
Bitcoin mining, according to China, is a massive waste of energy that creates nothing valuable. One function of the payments network, according to proponents, is to assist people in avoiding surveillance governments such as, oh, China.