What To Know:
- China’s Bitcoin mining activity is rebounding, with the country regaining a 14% global market share despite the 2021 ban.
- Cheap electricity, excess energy capacity, and underused data centers in Xinjiang, Sichuan and Inner Mongolia are quietly powering the resurgence.
- Renewed hardware demand and flexible local incentives signal a softening environment, making China once again a key force in global mining dynamics.
Four years after Beijing declared a ban on the sector, Bitcoin mining activity in China is on the rise again. New data showed a consistent resurgence of miners within a number of western and southwestern provinces. This transition has been led by cheap electricity, unused energy capacity, and a surge in data center construction. The trend spans mining pools, hardware sales and regional electricity usage patterns, and is evident in quantifiable activity even in the face of the ongoing regulatory freeze.
Bitcoin Mining Surges in China
China once dominated global Bitcoin mining. The country’s share collapsed to zero in 2021 after authorities shut down facilities across Xinjiang, Sichuan, Inner Mongolia, and Yunnan. At the time, policymakers framed mining as a threat to energy conservation and financial stability. The crackdown triggered a mass exodus of Chinese miners to North America, Central Asia, and the Middle East.
Recent industry data shows a dramatic reversal. According to the Hashrate Index, China reached a 14 percent share of the global Bitcoin mining market at the end of October. This positions the country as the world’s third-largest mining hub once again, behind the United States and Russia. The rebound has been supported by a resurgence in hardware demand inside China. Mining rig maker Canaan Inc reported a sharp increase in domestic orders this year, with executives pointing to renewed confidence among local buyers.
Several miners operating in China say the incentives are straightforward. Xinjiang, Sichuan, and parts of Inner Mongolia continue to hold some of the world’s most competitive electricity rates. Seasonal hydropower surpluses, stranded energy assets, and new data center build-outs have created pockets of low-cost power that cannot be easily transmitted outside the region.
Wang, a private miner based in Xinjiang, said the economics made the decision simple. According to him, excess energy in the region ends up being consumed by crypto mining. He described growing activity and new projects being developed quietly across multiple counties that offer electricity at deeply discounted prices. His decision to share only his last name reflects the political sensitivity surrounding the business.
Local governments in Xinjiang also declined to comment. The lack of official communication has forced industry participants to look to market signals and on-the-ground observations to gauge policy sentiment. Its resurgence comes on the heels of strong Bitcoin activity in October, when crypto reached record highs before global risk sentiment weakened again. Even with the recent pullback, many miners reported better profit margins compared with the previous two years. US President Donald Trump’s pro-crypto policy signals boosted optimism throughout the industry. Increasing distrust of the dollar among global investors also pushed mining economics into a more favorable situation. Several analysts suggest regional economic pressures in China have contributed to renewed mining activity.
Perpetuals.com chief executive Patrick Gruhn said policy flexibility often emerges when local incentives strengthen. He called the revival one of the most important indicators for the digital asset market this year. According to him, even marginal signals of easing in China can act as a tailwind for Bitcoin as a globally distributed asset.
Industry participants describe concentrated activity in China’s energy-rich interior. Xinjiang remains a focal point. So does Sichuan, where some former mining operators have reassembled small clusters of machines. Duke Huang, who left the sector after the 2021 crackdown, said some of his peers have returned. He said the opportunity created by cheap electricity is driving miners back into the field, though many remain cautious.
A senior executive at a mining rig manufacturer said the rise in mining is partly fueled by an oversupply of electricity and computing infrastructure. Local governments invested heavily in data center construction over the past two years. Several projects consumed significant capital but delivered limited economic returns. The resulting excess capacity has become attractive to miners seeking low-cost power.
Globally, the United States currently leads the Bitcoin mining landscape with 36 percent of the network hash rate. Russia has a 16 percent share, supported by abundant energy resources and cold weather conditions that reduce cooling costs. Outside these markets, Norway, Paraguay, Canada, Kazakhstan, Iceland, Oman and Kyrgyzstan remain important hubs.
Also Read: BTC Mining Difficulty Reaches New High–What It Means For BTC Price?
