China’s Bitcoin Mining Comeback: How Miners Are Thriving Despite the 2021 Ban

By Editor | Updated November 24, 2025

In 2021, China shocked the crypto world by banning bitcoin mining and forcing operators to shut down or move offshore. For a while, it looked like the world’s former mining giant had completely exited the stage.

But new industry data now shows a different story: bitcoin mining in China is quietly making a comeback. From energy-rich inland provinces to newly built data centers, both individual and corporate miners are finding ways to plug back into the network and capture bitcoin rewards—despite the official ban still being on the books. :contentReference[oaicite:1]{index=1}

From Zero to Third Place Again: China’s New Mining Footprint

After the 2021 crackdown, China’s share of global bitcoin mining activity was widely assumed to have dropped to near zero. Miners sold rigs, relocated to North America, Central Asia, and other friendlier regions, and the global mining map shifted overnight.

Yet according to recent data from Hashrate Index, China has climbed back to roughly third place globally, with around 14% of the world’s bitcoin mining market share by the end of October 2025. :contentReference[oaicite:2]{index=2} Separate estimates from blockchain analytics firm CryptoQuant suggest that about 15%–20% of global mining capacity may now be operating from within China’s borders. :contentReference[oaicite:3]{index=3}

In other words, while the law hasn’t formally changed, real-world activity has. Mining in China never fully died—it went underground, adapted, and is now scaling up again.

Why Bitcoin Mining Is Returning to China

So what’s driving this quiet resurgence? Several powerful incentives are pulling miners back.

1. Cheap and Abundant Electricity

Miners consistently follow one rule: go where the power is cheapest. In parts of China, especially energy-rich hinterland provinces like Xinjiang, electricity is abundant and not always easy to transmit to major demand centers. Rather than letting excess power go to waste, local operations are monetizing it through bitcoin mining. :contentReference[oaicite:4]{index=4}

Private miners describe new projects under construction and a steady flow of rigs being installed wherever long-term low-cost power contracts can be secured, even if the activity has to stay discreet.

2. Overbuilt Data Centers and Idle Computing Power

In recent years, some local governments and businesses poured money into building data centers to attract tech investment. Not all of those facilities filled up with cloud or AI customers, leaving spare rack space, power, and cooling capacity.

That excess infrastructure is now being quietly repurposed. Industry sources say a glut of data center capacity in certain areas is helping fuel the rebound in mining, as operators slide in ASIC rigs where there was previously unused computing potential. :contentReference[oaicite:5]{index=5}

3. Higher Bitcoin Prices and Better Mining Economics

The revival of mining activity also coincides with bitcoin’s strong price action in 2025. The asset hit new record highs in October, boosted by pro-crypto policies from the U.S. administration and growing global unease about overreliance on the dollar. :contentReference[oaicite:6]{index=6}

Even after a subsequent pullback of roughly a third from its peak, bitcoin prices remain high enough to make efficient mining highly profitable—especially when powered by discounted electricity.

4. Softer Policy Signals and Strategic Thinking

Officially, bitcoin mining is still banned in mainland China. But observers note a subtle shift in the broader policy environment around digital assets.

Hong Kong’s stablecoin framework, which took effect in August 2025, is designed to position the city as a major hub for regulated, fiat-backed stablecoins—directly competing with U.S. initiatives in the same space. :contentReference[oaicite:7]{index=7}
China has also explored the idea of yuan-backed stablecoins to support the wider international use of its currency, signaling a more nuanced approach to digital money rather than blanket hostility. :contentReference[oaicite:8]{index=8}

Some analysts argue that bitcoin is increasingly viewed in strategic terms amid deepening U.S.–China rivalry—less as a threat to domestic stability, and more as another arena where influence and infrastructure matter.

Mining Rig Makers Confirm the Trend

Another way to track what’s happening on the ground is to follow the companies that sell the hardware. One of the most telling signals comes from Canaan Inc., one of the world’s biggest manufacturers of bitcoin mining machines.

Company filings show that China accounted for just 2.8% of Canaan’s revenue in 2022, when the 2021 ban was still freshly enforced. But by 2024, that share had jumped to about 30.3%, and internal estimates suggest that China may now be contributing more than half of the company’s revenue in recent quarters. :contentReference[oaicite:9]{index=9}

Canaan, which is headquartered in Singapore, stresses that its research, production, and sales in China are all compliant with local regulations. Importantly, designing and selling mining machines is allowed—what’s banned is the activity of mining itself.

Regulation vs. Reality: Can Mining Really Be Stopped?

Legal experts in China point out a simple truth: when an activity is highly profitable, it becomes very hard to stamp out completely.

Despite the formal ban, estimates from firms like CryptoQuant point to ongoing and substantial mining activity, particularly in remote areas where oversight is harder and local economic incentives dominate. :contentReference[oaicite:10]{index=10}

Some lawyers and analysts believe that over time, Beijing may gradually loosen its stance—not by loudly endorsing bitcoin, but by tolerating certain types of digital-asset-related business or shifting to more targeted rules rather than blanket bans.

For now, miners in China still operate in a gray area. Their operations must stay low-profile, rely on trusted partners, and remain flexible enough to move or shut down quickly if enforcement tightens.

What China’s Mining Rebound Means for Bitcoin

For bitcoin itself, the return of Chinese hashrate has several important implications:

Extra demand for mining rigs and power can support bitcoin’s price by reinforcing the cost of securing the network.
Geographic distribution of hashrate shifts again, as China regains some influence it lost to the U.S., Kazakhstan, and other countries after 2021.
Policy risk remains real: if authorities crack down hard again, a sudden drop in Chinese hashrate could create short-term volatility in network difficulty and miner profitability.
Long-term resilience narrative grows: the fact that mining activity can re-emerge even in a “banned” jurisdiction reinforces the idea that bitcoin is highly resistant to state-level suppression.

For serious crypto investors, the takeaway isn’t that China is suddenly “pro-bitcoin” again. Rather, it’s that economic incentives, energy realities, and global competition can nudge even strict regulatory environments toward more nuanced outcomes.

Key Takeaways for Crypto Investors and Traders

Don’t underestimate China’s role: Even after a full-scale ban, the country has quietly returned as a major contributor to global hashrate.
Watch energy and policy trends: Mining follows cheap power and policy flexibility. Provinces with surplus energy are likely to remain hotspots.
Mining stocks and rig makers may benefit: Companies selling into China, like mining-machine manufacturers, can be indirect ways to gain exposure to this trend.
Regulatory risk never disappears: Any position tied to Chinese mining should factor in the possibility of renewed enforcement or headline risk.

As always, none of this is financial advice—just another layer of context as you evaluate bitcoin, altcoins, and mining-related investments.