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Announced several weeks ago, the ban on Bitcoin mining in China has really materialized since the beginning of June 2021. Chinese miners are forced to shut down their equipment or face sanctions by the Chinese authorities.
For many Bitcoin opponents, this is the long-awaited signal that Bitcoin will soon be dead.
These opponents will be disappointed once again, as Bitcoin will survive this ban from China. Bitcoin is like a phoenix that always emerges stronger from its trials. This will be the case again this time.
Bitcoin Hash Rate Hits 8-Month Low
In fact, it is undeniable that the Hash Rate of Bitcoin is falling heavily:
Bitcoin's Hash Rate just hit an 8-month low.
For some, it is an extreme fear that prevails as we saw in the price of Bitcoin on June 22, 2021. For others, those who know how to take a long-term view of things, this is Bullish for Bitcoin.
I think this is the best thing that could happen for the long-term success of Bitcoin.
China's Ban Causes Big EXODUS of Bitcoin Mining to the West
For as long as I can remember, Bitcoin's opponents have been saying that the Bitcoin Hash Rate is too concentrated in China. This centralization has been a concern and a threat to the future of Bitcoin in their eyes. This problem is now solving itself.
The banning of Bitcoin in China is causing all the mining companies to redeploy all their equipment to other parts of the world. We are witnessing the great exodus of Bitcoin mining.
Announcements are pouring in from companies that are sending their equipment to the West. Some are going to the United States, while others are choosing geographically closer countries: Kazakhstan, for example, is a popular destination.
On June 22, 2021, the Chinese company BIT Mining made the first delivery of 320 machines to Kazakhstan. These machines come directly from Sichuan, a Chinese province where a large part of the Hash Rate power from China was concentrated.
BIT Mining expects to deliver an additional 2,600 machines in early July 2021.
BIT Mining's data centers in Sichuan accounted for 3% of the Bitcoin network's Hash Rate in May 2021. In addition to its redeployment to Kazakhstan, BIT Mining has just invested $25 million in a new mining center in Texas, America.
Mining equipment will be back in service elsewhere in the world in the coming weeks
America is going to be a destination of choice from now on.
A tweet from Eunice Yoon, a CNBC representative in China, published on June 21, 2021, showed China logistics firm in Guangzhou preparing to ship more than 3,000kg of Bitcoin mining machines to the United States, specifically to Maryland:
While China wants to ban Bitcoin to make more room for its digital yuan, the United States and other Western countries will gladly welcome all these Bitcoin miners. We may even have a battle between different American states to host Bitcoin mining companies.
Miami Mayor Francis Suarez, for example, has reaffirmed his support for Bitcoin by urging miners to come and take advantage of the low-cost nuclear power Miami can offer them.
While other parts of the world may offer lower gross electricity prices than the United States, there are other parameters to consider that come from this.
America will be the big winner because it has a lot to offer to Bitcoin mining companies
The United States has political stability, a clear and favorable regulation, but also a respect for private property that will reassure all those companies that are forced to leave China massively. It is therefore a destination of choice. If these mining companies do not choose the United States, they will go to Central Asia or elsewhere in the world.
In any case, they will be redeploying their Hash Rate power to the Bitcoin network in the coming weeks and months.
That's a certainty. So what is happening now is extremely Bullish for Bitcoin. The dependence on China will soon be a problem solved. Miners migrating to the West will be able to focus on greener mining with massive use of electricity from renewable energy.
Another issue constantly raised by Bitcoin opponents will also be resolved: the environmental impact of Bitcoin, which is (wrongly) considered negative.
Companies that relocate to America will be able to provide tangible proof of where their electricity comes from, which will reassure all those investors like Elon Musk who seem to be concerned about it.
Final Thoughts
Rather than focusing on the price of Bitcoin, you should look at everything that is currently happening in the Bitcoin mining world. The fundamentals of Bitcoin will come out of this situation stronger, and those who have taken advantage of the current situation to accumulate more will once again be the big winners.
As always with Bitcoin, you have to be able to filter out the noise to focus on the real signal. This is your job to take full advantage of this incredible revolution in the future.
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