The Return of a Dominant Hub
Bitcoin mining is quietly resurging in China four years after Beijing banned all cryptocurrency mining and trading, according to miners and industry data. Despite the sweeping 2021 crackdown, individual operators and corporate entities are increasingly tapping cheap electricity and surplus computing capacity in energy-rich provinces.
China, once the world’s dominant mining hub, saw its share of global hash power collapse to zero after the ban. But new data from Hashrate Index shows the country has climbed back to third place, holding a 14 percent share of global Bitcoin mining activity as of late October. The revival aligns with a period of higher Bitcoin prices, renewed mining profitability and regional governments struggling with excess electricity and data-center infrastructure.
Private miners describe a pragmatic reality on the ground: abundant power must be consumed locally, and crypto mining remains one of the fastest ways to monetize stranded energy. A miner in Xinjiang, identified only by his surname Wang, said new projects are actively being built in the region, noting that "people mine where electricity is cheap."
Investor Takeaway
Behind the Scenes: Driving Forces of the Mining Rebound
The resurgence is being fueled by a mix of economics, technology and policy ambiguity. Bitcoin reached record highs in October on the heels of pro-crypto sentiment from U.S. President Donald Trump and rising distrust of the U.S. dollar. Although prices have since corrected, miners say current revenue levels remain attractive.
Several long-time miners who left during the crackdown are returning. In Sichuan, former operator Duke Huang said some of his peers re-entered the industry, driven largely by cheap electricity that local governments are eager to monetize. A core driver is the overbuilding of data centers across some Chinese provinces. Cash-strapped local authorities invested heavily in infrastructure designed for cloud services, AI workloads and digital industries. Much of that capacity sits underutilized, bringing abundant power and computing resources that miners can exploit discreetly.
A source at a leading mining rig manufacturer said the glut has become "a tailwind for miners," though he asked not to be identified due to political sensitivities.
Hardware Sales Confirm China's Mining Revival
Mining machine manufacturers are one of the clearest indicators of China’s accelerating activity. Canaan, the world’s second-largest Bitcoin mining rig maker, generated 30.3 percent of its global revenue from China last year, a dramatic jump from just 2.8 percent in 2022 after the crackdown. According to a source with direct knowledge, China’s share of Canaan’s revenue rose to over 50 percent in the second quarter of 2025.
While Canaan did not confirm the exact figures, it acknowledged that China has become a significantly stronger market this year. The company attributed rising sales to U.S. tariff uncertainty, stronger Bitcoin prices and "a subtle shift in China’s digital asset posture." Canaan stressed that its operations remain compliant with Chinese law, emphasizing that research, development, manufacturing and sales of mining machines are allowed—even though mining itself is officially banned.
Signs of policy softening are emerging across the region. Hong Kong introduced a regulatory framework for stablecoins in August, aiming to compete with the U.S. in developing a compliant market for fiat-backed digital assets. Meanwhile, Reuters reported that China is exploring yuan-based stablecoins to boost cross-border currency adoption.
Investor Takeaway
A Quiet Shift in China's Crypto Policy?
Officially, Bitcoin mining remains banned, and the National Development and Reform Commission did not comment on the renewed activity. But industry participants say enforcement varies by region and is influenced by local economic incentives. Patrick Gruhn, CEO of Perpetuals.com, said Chinese policy "flexibility emerges when economic incentives are strong," calling the mining revival "one of the most important signals the market has seen in years."
CryptoQuant estimates that between 15 percent and 20 percent of global Bitcoin mining capacity currently operates in China, despite the prohibition. Analysts say completely eliminating mining is nearly impossible as long as it remains profitable, particularly in areas with cheap electricity and excess infrastructure.
Liu Honglin, founder of Man Kun Law Firm, echoed this view. "I personally think government policies against mining will be gradually loosened, because you simply cannot stop such activities completely," he said. Whether Beijing formally updates its stance remains unclear. But miners and hardware manufacturers suggest a growing tolerance—at least where mining absorbs unused power and provides economic relief to local governments.