Jianping Kong, who used to be co-chair of Canaan, said that the 10% drop in Bitcoin’s hashrate in one day was due to roughly 400,000 mining rigs shutting down in China’s Xinjiang province.
Bitcoin’s hashrate dropped by roughly 10% in just one day on Sunday. Former co-chairman of Bitcoin mining gear maker Canaan, Jianping Kong, attributed this to the closure of mining farms in China’s Xinjiang autonomous province.
Bitcoin’s hashrate had declined by around 100 terahashes per second (TH/s) since Sunday. The dip was caused by “at least 400,000 machines” shutting down, based on an estimate of 250 terahashes per application-specific integrated circuit (ASIC) miner.
YCharts says that Bitcoin’s hashrate went down from 1,053 TH/s on Sunday to a little under 943 TH/s on Monday. That means losing more than 10%, or 110 TH/s. Even so, the overall hashrate of the network is only an estimate based on network information and can’t be determined exactly.
China’s unstable role in Bitcoin mining
China has been a big player in the Bitcoin (BTC $87,909) mining business in the past, but it has also been an unstable supplier of hashrate. Before 2021, China was responsible for most of Bitcoin’s hashrate (approximately 65%), but that year the Chinese authorities stopped mining.
Mining operations started up again all throughout China in 2024, and the October Hashrate Index data showed about 14% of all Bitcoin mining in the world happens in China. CryptoQuant says that China’s share is between 15% and 20% of the total Bitcoin hashrate.
Reuters said last month that both private and corporate miners are taking advantage of inexpensive electricity all around China, even though it is against the law. Kong isn’t thrilled about the scenario. US wins without lifting a finger” now that Xinjiang’s Bitcoin mining rigs are closing.
US expands Bitcoin mining and scrutiny of China
Kong’s statements come at a time when the Bitcoin mining business in the US is growing very quickly. Hut 8, a firm that mines Bitcoin, said at the end of August that it was developing four new Bitcoin mining sites in Texas, Louisiana, and Illinois. These sites will add 1.5 gigawatts of power.
In early May, Hut 8 became public through a merger with American Bitcoin, a Bitcoin mining and treasury company that is connected to the Trump family. Eric Trump, the second-oldest of US President Donald Trump’s three sons, sits on the board of directors for the company. This makes it clear that US politicians are also banking on Bitcoin mining.
The US is also going after China’s Bitcoin mining and ASIC businesses more directly. Reports from late November said that the US is looking into Bitcoin, the largest maker of Bitcoin mining ASICs, because of worries about national security. Bitcoin is based in China.
The goal of the inquiry is to find out if the technology can be operated from a distance to spy on or damage the US electrical infrastructure. The Trump family may also be affected by the measures that are put in place after the investigation. Bitmain sold 16,299 Antminer U3S21EXPH machines for American Bitcoin.
In October 2024, US officials looked into Chinese chip designer Xiamen Sophgo, which is tied to Bitmain, because it was thought to have a commercial contact with Huawei, a company that the US has put sanctions on. Just a month later, the US Customs and Border Protection Agency halted the shipment of thousands of Bitmain ASICs. The US government didn’t start giving out the gear until March.