• China attempted to ban crypto mining in 2021, but the effects were only temporary.
• Bitcoin’s hashrate has now hit a new all-time high, near 300 exahashes per second (EH/s).
• Companies such as Blockstream have shifted their operations to crypto mining, and other countries such as Kazakhstan have also benefited from the ban.
In May-June 2021, China took a drastic step by banning crypto mining, and the effects were felt immediately. The bitcoin hashrate dived, and the price of the world’s largest cryptocurrency halved from $60,000 to $30,000. It seemed like the ban had a lasting effect on the industry, but the bitcoin network has now reached its new all-time high in terms of hashrate, at around 300 exahashes per second (EH/s).
The lack of long-term effects has been beneficial to many, including companies that have shifted their focus to crypto mining. One such company is Blockstream, which is now making more money from mining operations than code development. The company recently raised $125 million from Fulgar Ventures and Kingsway Capital. Before the 2021 bull run, there were no publicly traded miners, but now it is a common occurrence, allowing miners to hold more in bitcoin since they can now raise capital from the stock markets.
Other countries have also taken advantage of China’s ban. Kazakhstan, for example, recently passed a law on Digital Assets of the Republic of Kazakhstan, introducing licensing requirements for miners and a higher electricity price. The country also released plans to inject over $700 million into crypto mining. The USA too has seen an increase in miners, although it was lagging behind before the ban.
The effects of the ban are still being felt, with some countries and companies benefitting from it. However, the main takeaway is that the ban has had little to no effect on the bitcoin network. Its hashrate is at an all-time high, and the industry is still growing. It is clear that the ban was just a blip in the chart and that the crypto industry is still going strong.