China was home to a lot of crypto mining companies, but its decisions forced many companies to leave the country. Even before authorities decided to kick out all of its bitcoin miners, they were already leaving in droves and they were likely headed to the U.S.
As a result, the U.S. became the new driving force of the bitcoin mining world. The U.S. is the second-biggest crypto mining destination on the planet, accounting for nearly 17% of all of the world’s bitcoin miners as of April 2021. The data mentioned above doesn’t take into account the mass mining exodus out of China, which led to half the world’s miners dropping offline. Experts think that the U.S. share of the market is likely even bigger than the numbers indicate.
Just before the Chinese crypto mining ban began, China accounted for 46% of the world’s total hashrate. That is a huge decline from 75.5% in September 2019. Furthermore, the percentage is likely much lower given the mass exodus underway now.
Bitcoin mining in the U.S.
America’s rising dominance is a simple case of luck meeting preparation, as the U.S was ready to strengthen its position on the mining market. When Bitcoin crashed several years ago there was not much demand for huge Bitcoin farms. The U.S. crypto mining companies took advantage of cheap money and created the mining ecosystem in the U.S.
Before bitcoin miners actually started coming to the U.S., companies across the country realized that eventually, if adequate infrastructure were in place, foreign companies would set up shop in the country.
The seeds of U.S. immigration started more than a year ago. Prior to China’s sudden crypto crackdown, the country’s mining dominance had already begun to decline. Part of the appeal is that the new crypto mining hub ticks a lot of the boxes for these migrant miners. Companies that are looking to relocate crypto miners out of China, have to take into consideration several factors. They are looking for countries that have the potential to offer them favorable conditions.
Crypto miners at scale compete in a low-margin industry, where their only valuable cost is usually energy. Crypto mining companies are incentivized to migrate to the world’s cheapest sources of energy. The world’s largest economy is home to some of the cheapest sources of energy on the planet.