In recent days the world of cryptocurrency has revolved around information about the massive shut-down of the Bitcoin mine in the Xinjiang region of China. According to a statement by Kong Jianping, former co-president of Canaan Inc. and current founder and president of Nano Labs, about 400,000 of the Bitcoin digging facilities were deactivated, resulting in a global hashrate decline of about 8%, or 100 EH/s.
Event Details
Kong Jianping, as quoted in industry reports, indicated that the closures are due to compliance checks and exemptions in the Xinjiang region. Many older machines have become unprofitable in the face of these regulatory measures. The decline in hashrate is a direct result of these operations, which confirms the analysis of the data from the Bitcoin network. Sources indicate thatThe mines in Xinjiang, known for its low energy costs, were a key element of the mines' revival in China after the 2021 ban.
According to Wu Blockchain's report, citing a representative of Nano Labs listed on Nasdaq, the main causes are the closure of the Bitcoin mine farms in Xinjiang.The exact reasons for exemptions are not fully disclosed, but speculation is that they may be linked to new environmental or political regulations.
Historical background
China has a rough story with a Bitcoin mining.In 2021, the Chinese government introduced a complete ban on cryptocurrency digging, leading to mass exodus of miners to other countries such as the United States and Kazakhstan. However, in recent years, mining has begun returning to China, using cheap energy in regions like Xinjiang and Inner Mongolia.According to the November 2025 Reuters report, despite the ban, individual and corporate miners use cheap energy, allowing China to regain its position in the global hashrate.
In November 2025, the media reported a return of mining activity in Xinjiang, contrasting with current closures.This shows regulatory instability in China, where cryptocurrency policy remains strict, despite occasional signs of thawing.
Market implications
A fall in hashrate by 8% can have short-term effects on the security of Bitcoin, although historically the network recovers rapidly thanks to the migration of miners. Disabling older machines can accelerate the modernisation of equipment, which will increase energy efficiency in the long term. For investors, it is a reminder of the geopolitical risk in the cryptocurrency sector, especially in the context of dependence on Chinese infrastructure.
Analysts indicate that closures in Xinjiang may be part of a wider compliance campaign, potentially affecting global energy prices and availability of mining equipment. Nano Labs, as a chip manufacturer, can use the demand for newer devices.
The closure of the mine in China is another chapter in the complicated relationship between Beijing and the cryptocurrency world. Despite the 2021 ban, mining returned, but current actions show that the authorities are still monitoring and intervening. The cryptocurrency market will track whether it is an isolated incident or the beginning of a wider wave of regulation.
