The mining of Bitcoin in China has regained strength thanks to cheap electricity and hydroelectric surpluses in key regions, driving the country to a 14% share of the global hashrate and placing it as the third largest center worldwide, according to Reuters. The rebound is striking because it comes despite the official 2021 ban, raising new questions about oversight and network security.

China’s mining comeback and its drivers

The resurgence is fueled mainly by abundant, low-cost energy and the survival of pre-ban infrastructure. In provinces like Xinjiang and Sichuan, excess hydroelectric production sharply reduces operating costs, making it profitable to turn idle hardware back on. The increasing hashrate reflects a renewed wave of mining capacity returning to the network.

Operators and small pools have reactivated equipment stored since 2021, capitalizing on data centers built before the ban and unused by other industries. Some local governments that overbuilt data-center infrastructure are reportedly offering ultra-low-cost entry points, while miners adopt tactics such as remote sites, VPN use and embedding rigs inside legitimate-looking industrial facilities.

Hardware sales also confirm the trend. China’s share of global sales for Canaan jumped from 2.8% in 2022 to 30.3% in 2024 and surpassed 50% in Q2 2025, pointing to a clear resurgence in domestic demand for mining rigs.

“A lot of energy cannot be transmitted out of Xinjiang, so you consume it in the form of crypto mining,” said Wang, a private miner, illustrating how energy surplus directly incentivizes mining despite the ban.

China’s return to mining reshapes global hashrate distribution and makes tracking energy consumption more difficult. Even as Beijing maintains its formal prohibition, Hong Kong’s pro-innovation stance introduces regulatory ambiguity, offering indirect space for crypto-related activity.

Environmentally, the revival increases concerns about emissions from fossil-fuel-linked grids, contradicting the original rationale of the 2021 ban that sought to curb energy waste and pollution.

Globally, China’s 14% share contrasts with the United States’ 37–37.8% leadership. A more fragmented hashrate can strengthen network resilience, but it also shifts security dynamics and market sentiment.

China’s mining resurgence highlights the power of energy economics and the resilience of specialized infrastructure, forcing regulators and industry participants to monitor both energy traceability and the source of electricity feeding mining operations.