The mining business was badly hurt when China made a move to destabilize the crypto industry and issuing a crackdown against all crypto mining, especially for the flagship cryptocurrency Bitcoin. Bitcoin’s hash rate was literally balanced by the miners who had established their mining facilities throughout China. But when China, either out of the fear for decentralized finance or minimizing the carbon footprint, issued a crackdown against these mining facilities, people were forced to look out for other mining stations, and Bitcoin’s hash rate dropped significantly.
Mining was not the only aspect that got ridiculed by China; it was purchasing of the crypto involving in any investment, which included cryptocurrencies, its trading and working with crypto exchanges as well was banned thoroughly in China. At the time of the crackdown, there were some banks and financial institutions which were dealing with Bitcoin, but when people’s Bank of China released a specific summary to issue a complete halt against the use or involvement of digital assets, all other banks had to comply and cut off their relation with Bitcoin altogether.
Crypto Mid-May Crash Happened Due To China’s Crackdown Against Mining Operations
Bitcoin’s hash rate was plummeting more severely than ever before, and it was about at a 55% drop which was pretty huge, and this very factor issued a market-wide collapse for Bitcoin, which is also known as the mid-May crash. Miners who were stationed in China due to the low cost of electricity and hydropower projects which provide them with low cost of electricity and enough power to carry on their mining operations around the clock, had to look out for other pastures or more friendly nations regarding crypto mining.
Some have moved to the US while others have stationed themselves in Europe, but what about the local miners, the Chinese miners where would they go? The most convenient thing to do for them would be to lay low and look out for places or hideout from where they can build and continue their mining operations, but given this tenacious crackdown, it would be a difficult task indeed.