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Tuesday, January 26, 2021

Effects of China Floods 2020 on Bitcoin Mining Farms and Hash Rates

Effects of China Floods 2020 on Bitcoin Mining

The current ongoing monsoon season has created havoc within the province of Sichuan as the continuous outpour has led to a decline in the bitcoin hash rate. China contributes to over 50 percent of the world’s bitcoin hash rate and major bitcoin mining carries out in Sichuan.

Sichuan being a mountainous region record continues and heavy rainstorms from many days that led to a drop of bitcoin hash rate. In the last couple of days, this decline led to its peak, on an average of 15 percent drop in daily hash rates.

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According to some reports, the world’s leading mining pools, PoolIn, F2Pool, BTC.com, and Antpool which are based in China, recorded a 10 percent to 20 percent drop in the bitcoin hash rate in the last 24 hours. The combined computing power of all these pools contributes nearly 50 percent of the total bitcoin hash rate.

You may also want to know – How does Crypto fit in with China’s new Inheritance law?

Traditional Wet Season Turned into a Disaster

Sichuan is located upstream of the Three Gorges Dam which is the largest hydroelectric dam in existence. The wet season is usually considered as good for the bitcoin miners as the running water generates more power for the mining process. However, China Floods in 2020 reversed the fact. Concerning the matter, CEO and Co-founder of Poolln, Kevin Pan said,

“The heavy rainstorms have caused electricity outages in parts of the region as hydro-plants stop generating power to help discharge the floods. Some countries are also experiencing telecommunication and internet breakdowns,”

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Many other bitcoiners have also talked about the devastating effects of the heavy rainfall and floods on the Chinese mining operations. Coinmetrics founder Nic Carter had tweeted almost a month ago about the bad situation with the Three Gorges Dam.

In a nutshell, the monsoon season in China brings abundant rain and excessive hydropower resources required to carry out bitcoin mining every year. But the severe floods this year have even blocked the highway that leads to Sichuan due to mudslides where most of the mining farms are located. However, the floods have caused a temporary halt on the bitcoin mining farms. More so, this might have destroyed some of them.

On the other side, the value of the Bitcoin flourished even more today. Bitcoin began Monday with $12000 and at the time of reporting this, Bitcoin is valuing at $12,263.25. The market cap is currently counting at $226,428,579,779 with a surge of 3.65 percent within the past 24Hrs.

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