New Report Shows China Dominates Bitcoin Mining, Is This a Sign of Worry? - Forbes

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New Report Shows China Dominates Bitcoin Mining, Is This a Sign of Worry? - Forbes Posted: 12 Dec 2019 12:00 AM PST domestic gpu cripto mining rig on wall with selective focus. Getty 2019 has been a relatively good year for miners, generating $5.4 billion in total revenue. But, according to the year-end report of CoinShares, one country has dominated bitcoin mining throughout the year more than any other. The research paper entitled "The Bitcoin Mining Network", which explores trends, average creation costs, electricity consumption and sources in bitcoin mining, discovered that nearly 65 percent of bitcoin hashrate originates from China. "Regardless of the reasons, the effect is that the current Chinese hashrate ratio is likely higher than in June 2019. While we expect this ratio to fall again as latest generation hardware further makes its way into the non-Chinese market, at the time of writing, as much as 65% of Bitcoin hashpower resides within China – the highest we've seen since we began our network monitoring in late 2017," the report read. For many years, China has consistently been a major market for bitcoin miners due to its cheap electricity and affordable resources. Companies like Bitmain, F2Pool, and Canaan that account for a large portion of the Bitcoin network's hashrate are all based in China. Distribution of the Bitcoin network's hashrate (Source: Blockchain.com) Blockchain.com However, in April, the National Development and Reform Commission (NDRC) of China included bitcoin mining on a list of industries it plans to phase out over time. The unexpected move of the Chinese government left mining companies wondering the future of China's mining sector. In a strange turn of events, following Chinese President Xi Jinping's call for increased efforts in blockchain development, China essentially unbanned bitcoin mining in the last quarter of 2019. Since then, China's bitcoin mining sector has prospered. Eventually, it recovered from a slow several months in mid-2019 to establish dominance over the cryptocurrency mining industry once again. Whether much of the Bitcoin network's hashrate coming from China is necessarily negative or positive depends on perspective. But, as a purely permissionless and decentralized network, it is always favorable to have more geographically distributed hashrate. In the hardware side, the dominance of Bitmain has started to subside, which opens the space up for increased competition. Companies like Hut8, Bitfury, and Canaan are competing to take the top spot in the bitcoin mining sector. "Since our last report in June 2019, we estimate that Bitmain's market share by hashrate has fallen from ~70% to ~66%. To add context, Bitmain's own estimates (via Frost and Sullivan) claim that as recently as in in 2017, their market share was around 75%," said the CoinShares research team. Hence, while the dominance of China in bitcoin mining has increased, in the hardware department, the industry has begun to see a more competitive environment. The expansion of major mining facilities to other major mountainous areas such as Washington, British Columbia, and Norway also serve as signs that the geographical distribution of bitcoin hashrate will improve over time, as the sector evolves. "Among these regions we find the major mining centres of: Washington and New York States in the United States; British Columbia, Alberta, Newfoundland & Labrador, and Quebec Provinces of Canada; Iceland; Northern Scandinavia (Norway and Sweden); The Caucasus (Georgia and Armenia); the Siberian Federal District of Russia; Yunnan – and most importantly of all regions, Sichuan – provinces of China," CoinShares researchers wrote.

Crypto Ponzi Scheme; China Dominates Bitcoin Mining - Forbes Posted: 15 Dec 2019 12:00 AM PST Get Forbes' top crypto and blockchain stories delivered to your inbox every week for the latest news on bitcoin, other major cryptocurrencies and enterprise blockchain adoption. Getty CHINA'S MINING DOMINANCE A new report has found that nearly 65% of the bitcoin hashrate originates from China, meaning that China has dominated bitcoin mining more than any other country this year.  2019 has been a relatively good year for miners in general, generating $5.4 billion in total revenue, and China has consistently been a major market for bitcoin miners due to its cheap electricity and affordable resources. Companies like Bitmain, F2Pool and Canaan, which account for a large portion of the Bitcoin network's hashrate, are all based in China. Following Chinese President Xi Jinping's call for increased efforts in blockchain development, China essentially unbanned bitcoin mining in the last quarter of this year. CRYPTO MARKETS Bitcoin, which started the year at around $3,500, soared to well above $10,000 this summer before crashing back to trade around $7,000 amid fears that Facebook's planned cryptocurrency project could cause central banks and regulators to take action against crypto.  The digital currency suffered a notable decline last month—bottoming out at a monthly low of $6,524—after surging nearly 40% in a matter of hours after China's head of state made optimistic comments about blockchain technology in October. TAGOMI SLASHES FEES Tagomi, a New Jersey startup whose software helps institutional investors trade cryptocurrencies, has cut its fees nearly in half, now charging 0.1% or less per trade. Its new rates are about 70% lower than what you'd pay on digital asset exchanges Coinbase and Gemini if you wanted to buy $10,000 worth of bitcoin. On a trade that size, you'd save $25 using Tagomi. Tagomi's goal is to attract customers with low trading fees and then upsell them on "prime brokerage" features, including letting users borrow cash, borrow crypto assets and sell assets short. THREE ARRESTED IN CRYPTO PONZI SCHEME TARGETING "SHEEP" The U.S. Department of Justice arrested three people this week for running a Ponzi scheme that bilked $722 million from investors over the last five years. The operators of"BitClub Network," a purported mining pool operation, fooled investors by posting imaginary returns on the Bitcoin mining operations—all while not actually mining any bitcoin. According to the DOJ, the target audience was "dumb" investors, who the operator referred to as "sheep," saying he was "building this whole model on the backs of idiots." ENTERPRISE Health-insurer Anthem is using blockchain to help patients securely access and share their medical data. The company plans to roll out a new feature, currently in pilot testing now, which lets users open an app on their phones, scan a QR code, and instantly grant different healthcare providers access to their health records—but only for a limited amount of time. As soon as the appointment is over, users can revoke access and make their medical records private again. BLOCKCHAIN 2020 Bear market or not, 2019 was a banner year for blockchain tech. We saw the birth of new alliances, new cryptocurrency trading products, bitcoin and ether survived that bear market, and a plethora of blockchain protocols matured and expanded in growth.  But what does 2020 have in store? We're looking ahead to the launch of China's Central Bank Digital Currency, developments surrounding libra's launch, the progression of Ethereum 2.0, and more. Click here to learn more.  ELSEWHERE Electronic Swiss franc? Not so fast, government says [Reuters] Hold Tight, Here Come the Blockchain Wars [CoinDesk] Blockchain is becoming key for global trade - but is that a gift for hackers? [World Economic Forum]

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