China’s State Council announced it would crack down on bitcoin trading and mining in late May of this year. After the local government of Sichuan issued a ban on crypto mining a week ago, the hashrate dropped substantially. China’s ban drove cryptocurrency miners overseas and the offlining of so many mining rigs is set to cause the mining difficulty level to drop. The cryptocurrency value went up from $30,513 to $33,563, at one point spiking in a surge of 9.2 percent.
Now the hashrate is rising as miners outside of China take advantage of the new coming difficulty level change, with one expert claiming this shows the “underlying integrity of bitcoin’s protocol”.
Speaking to Express.co.uk Max Keiser said: “You don’t fix bitcoin, bitcoin fixes you.
“China’s economy is structurally unstable due to corruption and debt.
“They simply couldn’t handle the underlying integrity of bitcoin’s protocol.”
On Saturday, bitcoin’s hashrate managed to climb back above the 100 exahash per second level.
Because of Beijing’s ban on mining and the offlining of the operations in China, the hashrate had fallen to a low of 91 EH/s three days ago.
The bitcoin network’s mining difficulty change is coming and it could see the difficulty drop by over 20 percent allowing small mining operations to become profitable.
The network’s mining difficulty is currently at 19.93 trillion and the change could bring it to 15.83 trillion next week.
In the last 24 hours, it saw an 8.19 percent increase with bitcoin rising to a high of $33,496.68.
China’s sweeping ban on cryptocurrency mining last week temporarily paralysed the industry.
Over half of global bitcoin production was centred in China
However, now miners are fleeing the country to seek refuge in places such as Texas, and Kazakhstan.
Last week, speaking to Reuters, Mike Huang, operator of a crypto-mining farm in the southwest province of Sichuan said: “Many miners are exiting the business to comply with government policies.”
The Financial Conduct Authority has just ordered cryptocurrency exchange Binance that it must stop any regulated activities without its prior written consent.
Speaking about institutional aversion to bitcoin in the UK and how it is similar to the crackdown in China, Mr Keiser said: “Britain is similarly mired in corruption and self-deceit.
“The British people are starving for the integrity of bitcoin.
“The government won’t have it.
“I predict an insurrection.”