BTC Hashrate Drops 5.6% later than China Shuts Down Xinjiang Miners
network computing power declined sharply this week following reports that large-scale mining operations in China’s Xinjiang region were taken offline, according to industry sources and on-chain data.
Network metrics show BTC’s global hashrate fell by an estimated 5.6% to 8% beginning around December 13, marking one of the most notable post-halving drawdowns in mining activity. The decline coincided with reports of widespread shutdowns across Xinjiang, a region historically linked to significant BTC mining capacity.
On-chain analytics account SinoCrypto approximately 2 gigawatts (GW) of mining capacity had been shut down in the region. The post added that nahead 500,000 mining machines were displaced as a result, forcing operators to either relocate equipment or halt operations entirely.
Industry commentators also reported that hundreds of thousands of ASIC rigs were taken offline within a short period. Estimates from mining executives and observers suggest between 400,000 and 500,000 machines stopped hashing, removing roughly 100 exahashes per second (EH/s) from the BTC network.
Why the Hashrate Drop Matters
Following the shutdowns, BTC’s hashrate fell from levels near 1,100 EH/s to as low as 1,040 EH/s, based on short-term network averages. While the decline was abrupt, analysts note that BTC has historically absorbed similar shocks during regional mining disruptions.
The reasons behind the Xinjiang shutdowns remain unclear. Although China imposed a nationwide ban on crypto in 2021. Past disruptions in the region have been linked to power inspections, local enforcement actions, or broader regulatory crackdowns.
BTC is designed to adapt to such changes. Mining hardy adjusts automatically roughly every two weeks to reflect shifts in available hash power, assisting maintain the network’s average block time near ten minutes.
Market reaction to the hashrate decline has been slightly bearish. While some volatility was observed, BTC price movements remain influenced by a combination of macroeconomic factors, derivatives positioning, and broader market sentiment, rather than mining dynamics alone.
Attention has now turned to how rapidly displaced mining capacity may return. Historically, similar shutdowns in China have led to a redistribution of mining hardware to regions with more stable regulatory frameworks, reshaping the global distribution of BTC’s hash power.
China Tightens Crypto Oversight
China’s rigid stance on digital assets was underscored this week later than following a small transfer that included the note Dogecoin, a move the bank said triggered internal virtual currency compliance controls and highlighted the sensitivity of monitoring systems to crypto‑related keywords.
Separately, former People’s Bank of China (PBoC) adviser Liu Shijin urged in settling imported excellents to assist balance China’s nahead $1 trillion trade surplus and bolster the currency’s global liquidity, a suggestion that reflects ongoing debate within Chinese economic circles about the role of the yuan in international trade even as domestic crypto activity remains tightly restricted.
