The Cambridge Bitcoin Electricity Consumption Index is showing a big shift in the cryptocurrency mining industry towards cleaner sources of energy.
New data published by Cambridge University suggests that the mining industry has changed significantly over the past six months. The control over mining by the Chinese segment has fallen by over 20% since October 2020.
Called the Cambridge Bitcoin Electricity Consumption Index, China remains at the top, followed by the U.S. and Russia.
According to the index, Xinjiang remains the province with the highest hashrate, at 54.37% as of April 2021. This is despite the fact that China has conducted a sweeping shutdown of mining farms in the country, as the government begins to impose regulations on the market.
New trends could compel shift to cleaner energy
Experts see some positive developments that are emerging from the change in mining’s geography. The crackdowns are forcing miners to move to other countries and seek more friendly energy sources. The move to renewable energy for bitcoin mining is now a legitimately big market, with companies like Square also investing in the change.
There’s more evidence of a movement towards clean energy in the form of a report by the Bitcoin Mining Council. The data shows that the global bitcoin mining industry’s sustainable electricity mix crossed 56% in Q2 2021, up from 36.8% in the previous quarter.
Speaking to CNBC, Foundry CEO Mike Colyer states that this would be a big win for Bitcoin,
“The Bitcoin network is ruthless in its drive for the lowest cost. Miners around the world are looking for stranded power that is renewable. That will always be your lowest cost. Net-net this will be a big win for bitcoin’s carbon footprint.”
Countries are also capitalizing on this shift, with Kazakhstan announcing electricity charges for crypto miners. A major Iranian power company is also focusing on selling electricity to crypto miners — while the government fines miners for using household electricity.
Mining crackdown part of governments’ regulation plan
The crackdown on mining, whether its cutting power supply or shutdowns, is only part of a multi-prong approach to rein in the crypto market. The governments are well aware that the crypto market now requires regulation, what with the enormous growth of the market earlier this year.
Accompanying these changes are exchange regulations and a broader general framework, which the U.S. now seems keener on than any other country. When the U.S. does announce a new regulatory scheme, it will likely have a tremendous effect globally, as many countries are waiting to see what the world’s largest economy will do.
All in all, this may not be such bad news for the industry, which is due to its regulation if it wishes to be more incorporated into the global economy. The resources that companies are pouring into renewable energy solutions for the mining industry might be the positive change it needs to alleviate some concerns about the market.
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.