The Bitcoin hash rate has hit a new eight-month low. The BTC mining ban in China is having an effect and supports bearish stimming in the market. Overall, the bitcoin hash rate has been over the last 5. decreased by more than 40% Weeks. China is trying to strengthen its own digital currency with a BTC mining and trading system Ban.
While the Bitcoin hash rate hit a local low, the Bitcoin price failed to break the all-important $ 42,000 mark again. As a result, the BTC price fell below $ 33,400 on Sunday. The large-scale ban on Bitcoin mining in China has pushed the hash rate down for the time being.
China is vehemently enforcing the mining ban and is forcing the mining companies to cease operations by a certain deadline. Sometimes with unannounced searches to “speed up” the process. Bitcoin miners have to look for new locations or permanently cease operations and sell their mining hardware.
Before the ban, the share of the total hash rate in China was over 60%. This share, which is also one of the biggest criticisms of the decentralization of Bitcoin, is currently falling suddenly and spreading worldwide. In addition, many new mining farms, such as those based in North America, are using sustainable energy sources. This development thus further promotes green BTC mining. According to Cambridge University, 39% of the total Bitcoin hash rate currently comes from sustainable energy sources.
This not only eliminates the point of criticism of the hash rate centralization in China, but also the debate about environmentally harmful BTC mining from coal power in China. Nevertheless, the effects of the ban will have a negative impact on the Bitcoin price in the short term. In the long term, the development towards the worldwide spread of the decentralized payment network is to be assessed positively.
Due to the collapse of the BTC hash rate, the level of difficulty has adjusted downwards in recent weeks, making it easier for miners to search for new blocks. The mining difficulty ensures that each block is found every 10 minutes on average. It is precisely this mechanism that ensures that Bitcoin will reach a maximum number of 21 million BTC in 2140.
The Bitcoin mining ban in China goes hand in hand with the country’s efforts to get the digital yuan, which is currently gaining popularity among the population. In a competition to register for banking apps, users can win 200,000 packages with 200 digital yuan each.
China is currently trying to get a head start on central bank digital currencies (CBDC). Because the USA, the EU and other countries are also planning their own digital currency in the coming years. BTC has triggered a veritable trend over the past ten years. The race for digital currencies is entering the first hot phase. Bitcoin as the only alternative to digital currencies from the various central banks will play a very important role in this decade.
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