The mining difficulty of Bitcoin registered a strong fall during the weekend, the highest decline seen in 2021 as a result of the fact that mining companies are leaving China after the country began intensifying its crackdown on crypto.
The mining difficulty for Bitcoin dropped by 16% yesterday. The network takes care of adjusting its mining difficulty every couple of weeks in order to reflect the level of competition between miners. Such a decline suggests that the competition has decreased.
More than 75% of miners that validate Bitcoin transactions are located in China.
But the government asked for a “severe” crackdown on and punishment of “illegal securities activities,” such as crypto mining or trading, citing the need for financial stability as a reason.
Following the announcement, the crypto market suffered a drop in double-digits. Some crypto mining companies and exchanges even put an end to their operations, such as Huobi, which contributes 4% of the world’s Bitcoin hash rate. BTC.TOP has also confirmed that it will stop its operations in China as a result of these regulations and move to the US.