China plans stricter crypto regulations amid mining dominance
Even with heavy restrictions, Chinese miners maintain their dominance due to technological advancements and cryptocurrency’s decentralised nature, allowing them to circumvent national regulations.
Chinese Bitcoin miners continue to control a significant portion of the global mining network, holding over 55% despite the country’s outright ban on cryptocurrencies. According to Ki Young Ju, CEO of CryptoQuant, while Chinese mining pools dominate the network, US pools gradually gain ground, managing around 40% of the mining power. The US pools primarily serve institutional miners, whereas Chinese pools cater to smaller miners in Asia.
This continued dominance persists despite China’s blanket ban on Bitcoin mining and trading, implemented in 2021. Even with these restrictions, technological advancements and the decentralised nature of cryptocurrencies have allowed mainland users to circumvent regulations, leading to increased money laundering risks. In response, China is set to amend its Anti-Money Laundering (AML) regulations in 2025 to oversee cryptocurrency transactions better.
The crypto market faces challenges, with Bitcoin miners reporting the lowest revenue in a year during August. Mining revenue fell to $827.56 million, a decrease of over 10.5% from July but a slight increase from the previous year. The number of Bitcoins mined also dropped from 14,725 in July to 13,843 in August, as the cryptocurrency remained around $25,000 for much of the month.
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