The Shift in Bitcoin Mining Dominance

Bitcoin’s global mining landscape is undergoing a notable transformation as U.S. mining companies gain ground. A recent chart shared by CryptoQuant’s founder, Ki Young Ju, highlights this evolving trend by showcasing the geographical distribution of Bitcoin mining pools from 2015 to 2024. The chart vividly illustrates the shift of mining power from China to the U.S., with other countries playing a minor role.

Decline of Chinese Mining Pools

From 2015 to 2021, Chinese mining pools held a dominant position, controlling nearly all of the Bitcoin network’s hashrate. This era of overwhelming Chinese dominance is visibly represented on the chart as a broad red area, indicating a near-monopoly by Chinese miners. Despite still holding a significant share at 55% today, China’s dominance has gradually declined since 2020, largely due to the regulatory changes imposed by the Chinese government on the crypto-mining sector, prompting many operations to relocate abroad.

Rise of U.S. Mining Pools

In light of China’s regulatory crackdown, U.S. mining pools have begun to expand rapidly, now accounting for 40% of the Bitcoin network’s hashrate. This growth, which began in mid-2021, has been fueled by the influx of Chinese miners seeking more favorable conditions. The chart’s blue area, representing U.S. mining pools, shows steady growth, underscoring the increasing influence of American institutional miners. This shift is significant, as the U.S. had a minimal presence in the mining sector before 2021.

Energy Use and Emerging Mining Markets

The surge in U.S. mining activity has also led to increased energy consumption. According to a report from the U.S. Energy Information Administration (EIA), Bitcoin mining accounted for 0.6% to 2.3% of the U.S. total energy demand in 2023. This electricity usage is comparable to the annual power consumption of several states, including Utah and West Virginia, and equates to the needs of three to six million homes.

As the U.S. continues to grow, other regions, such as Russia, are also making regulatory strides. In August, Russian President Vladimir Putin signed a law recognizing cryptocurrency mining as a legitimate business, establishing a formal framework for mining activities within the country.

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