Bitcoin Hashrate Drops 8 Percent – Mining Shutdowns in China Suspected

The Bitcoin network's hashrate has fallen by approximately 8 percent, or around 100 exahashes per second (EH/s), within 24 hours, according to industry reports. Jack Kong, CEO of mining chip manufacturer Nano Labs and former head of Canaan Inc., attributes the decline to the shutdown of mining facilities in China's Xinjiang region^[1].

Kong estimates that around 400,000 ASIC mining devices were taken offline. However, this figure appears questionable given the mining ban that has been in effect in China since 2021. Experts point out that daily hashrate fluctuations exceeding 100 EH/s are not uncommon.

Alternative explanations for the decline include the worldwide shutdown of unprofitable hardware due to falling Bitcoin prices, as well as the increasing repurposing of energy infrastructure for AI data centers.

The decline does not pose an acute threat to the Bitcoin network. The network already withstood a hashrate collapse of nearly 50 percent in 2021 following China's mining ban. The automatic adjustment of mining difficulty ensures that block time remains at approximately ten minutes.