According to a Chinese language Economic Daily News report, graphics cards and ASIC mining systems are expected to see a short-term surge in orders from the crypto mining sector in Sichuan province, where reportedly over seventy percent of the mining systems are located in China. Sichuan province has been hit by continuous heavy rainfalls in the last weeks, affecting thousands of people and causing heavy economic losses, according to the Ministry of Water Resources.
30% Drop in Hashrate Attributed to Floods
The Economic Daily News report said that the natural disaster cut the overall mining hashrate by around thirty percent worldwide, although this has been disputed by other sources. According to the National Meteorological Center, heavy rainfall hit areas including Hubei, Sichuan and Jiangsu provinces from last Thursday to Sunday.
Last week, thunderstorms struck 48 cities affecting over 250,000 people and causing estimated economic losses of 733 million yuan (US $111 million). No deaths or missing people were reported.
The National Meteorological Center warned local authorities to reduce outdoor activities and take precautions against flooding, flash floods and landslides.
“The Sichuan province had become a concentrated area of cryptocurrency mining activities due to its abundant amount and cheap electricity tariffs. The floods damaged tens of thousands of miners,” Golden Finance, a Chinese crypto news outlet reported. According to some statistics, more than seventy percent of the world’s crypto mining machines are located in China.
“Just before the floods stroke, Sichuan mining farms received a large number of mining escrow orders.” Golden Finance reported. The news outlet also said that the miners were often installed in mountainous and rural areas, where the housing is “relatively simple.”
Golden Finance also noted that a recent decline of the global mining hashrate is likely related to the natural disaster. It calculated that the entire network’s power had dropped significantly between June 24 and June 27, which coincides with the Sichuan floods. Due to variance, aka the luck with which miners discover new blocks, it is difficult to reliably calculate the BTC hashrate for a precise time period and to correlate it with the natural disaster.
Do you think Chinese floods were responsible for the drop in hashrate? Let us know in the comments section below.
Images courtesy of Shutterstock. China News Service. Golden Finance (金色财经)
Need to calculate your bitcoin holdings? Check our tools section.
Purchase Bitcoin without visiting a cryptocurrency exchange. Buy BTC and BCH here.