Bitcoin relies on a network of computers known as miners that solve mathematical problems to secure the currency, consuming vast amounts of electricity in the process.
Data from the Cambridge Centre for Alternative Finance (CCAF) shows that the previously rapid investment in new bitcoin mining plants stopped in China from September 2019 to April 2021 in anticipation of the ban.
China’s share of global bitcoin mining power declined from 75.5% to 46% over the period, while the existing miners remained static in size and waited for news.
During the same period the global mining share of Kazakhstan rose from just 1.4% to 8.2%, catapulting it to third place after the US.
Bitcoin has faced growing criticism for its impact on climate change and a rise in Kazakhstan mining is likely to further that narrative as the country is heavily reliant on fossil fuels.
In that same year, 70% of its electricity was derived from coal power, and 20% from natural gas.
Renewables made up only 1.4% of the country’s energy supply.
The Chinese ban has shaken up the entire sector, with CCAF data showing that more than half of miners worldwide have stopped operating.
The entire network was estimated to be using 132 terawatt-hours of energy in mid May but this plummeted to 59 TWh in early July.
Author: Matthew Sparkes
