China may lose its competitive advantages in the mining of the world's main cryptocurrencies. Earlier, China was heaven for crypto miners thanks to the cheap electricity. However, in other countries, electricity expenditures have also been significantly reduced. Besides, some of them have launched chip production outside the Asia-Pacific region.
However, some experts are sure that China will dominate the crypto mining sector for long because its supremacy here is unrivaled. The Cambridge Centre for Alternative Finance notes that China accounts for only 65% of global Bitcoin mining capacity. It means that no one can currently compete with it.
Nevertheless, in the near future, a rapid industrialization process may lead to the lowering of the electricity cost in some countries. They are sure to take advantage of the situation. Therefore, their share of the world hash rate will rise considerably pushing China down. Besides, there will be more places with more favorable conditions for cryptocurrency miners so that they will abandon China for pastures new.
At the same time, China's leadership in crypto mining does not pose a threat to network security since there are still quite a lot of third-party observers in the blockchain who can detect fraudulent actions at the earliest stage.
It is almost impossible to fathom that any state structures will be able to conduct a prolonged attack on the blockchain lasting several hours. However, even in the worst-case scenario, an attack can only lead to the extraction of empty blocks and the subsequent temporary suspension of validation of all transactions in the blockchain. The only way out of this situation is to wait for the attackers to retreat as they will have no other choice. There is also one other option which is blockchain code replacement. It will make the attack useless.
This is why many analysts emphasize the urgent need for the existence of projects such as BetterHash and Stratum V2. They make mining more decentralized by expanding external control.
Iran was the first to start preparing an alternative platform for the mining of bitcoins and other cryptocurrencies. In July this year, power plants in Iran were allowed to mine cryptocurrencies. The only conditions were to obtain the appropriate license and comply with tariff restrictions.
