How sudden enforcement in Xinjiang triggered forced selling, hashrate losses, and a sharp BTC pullback
Bitcoin’s latest sell-off didn’t come out of nowhere. Beneath the price charts, a familiar catalyst resurfaced: China’s mining crackdown. Fresh regulatory action targeting domestic mining operations — particularly in Xinjiang — appears to have accelerated downside momentum just as BTC was already under pressure.
What followed was a textbook miner-driven shock: machines shut down, revenue vanished, and Bitcoin hit the market fast.
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⚡ Xinjiang Clampdown: Hundreds of Thousands of Rigs Go Dark
Authorities in China’s Xinjiang region reportedly ordered the near-simultaneous shutdown of roughly 400,000 mining machines, abruptly cutting off a major source of global computing power.
For miners on the ground, the consequences were immediate:
Mining revenue dropped to zero overnight
Power and hosting contracts remained active
Equipment leases and transport costs continued
Relocation became urgent and expensive
With no cash flow and mounting obligations, many operators had no option but to liquidate BTC reserves to cover costs or fund rapid moves abroad.
This wasn’t strategic selling — it was survival.
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📉 Hashrate Shock: 100 EH/s Lost in a Day
Former Canaan chairman Jack Kong drew attention to the scale of the disruption, stating that Bitcoin’s hashrate fell by around 100 EH/s within 24 hours, roughly 8% of the global network.
The market reaction was swift:
Hashrate plunges
Confidence weakens
BTC breaks below $90,000
Price slides toward $86,000
While analysts caution against oversimplifying cause and effect, the timing was impossible to ignore.
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🔄 Why China-Based Miner Shutdowns Move Price
Bitcoin analyst NoLimit outlined the familiar chain reaction triggered by forced shutdowns in China:
1. Instant loss of mining income
2. Urgent need for liquidity
3. Forced BTC sales to stay operational
4. Spot-market sell pressure intensifies
> “This is not emotional selling,” NoLimit noted.
“It’s mechanical. Miners sell because they must.”
Beyond selling pressure, abrupt hashrate drops introduce uncertainty. Even though Bitcoin’s security remains robust, sudden declines in network power can:
Shake short-term confidence
Increase volatility
Amplify existing downtrends
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🏗️ China’s Quiet Mining Revival Made the Hit Worse
The impact was magnified by an uncomfortable reality: China had quietly re-entered the mining landscape.
Despite the 2021 nationwide ban, underground operations expanded. By October:
China controlled roughly 14% of global hashrate
Ranking as the third-largest mining hub worldwide
This resurgence was fueled by:
Cheap electricity
Regional power surpluses
Patchy enforcement
Local-level tolerance
Many miners believed the risk had normalized. The coordinated Xinjiang shutdown shattered that belief — turning perceived stability into sudden chaos.
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💸 Weak Prices and Fees Compound the Damage
The crackdown hit at the worst possible time.
Miners were already struggling:
BTC down ~30% from October highs
Transaction fees near cycle lows
Margins compressed across the sector
With profitability already thin, forced shutdowns pushed some operators to the edge — increasing the likelihood of additional $BTC flooding the market.
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🌏 Bigger Picture: China Still Matters — For Now
Bitcoin is designed to adapt. Difficulty will adjust, miners will relocate, and hashrate will recover over time.
But in the short term, sudden shocks from a major mining region like China can:
Distort supply-demand dynamics
Damage sentiment
Accelerate price corrections already in motion
The duration of this impact now depends on:
How fast miners relocate
How quickly hashrate stabilizes
Broader global liquidity conditions
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🔍 Final Take
This sell-off wasn’t just technical noise.
It was a China-driven miner shock, fueled by forced shutdowns, emergency BTC selling, and renewed regulatory uncertainty.
China may have banned mining on paper — but as this episode proves, its influence on Bitcoin hasn’t fully faded yet.
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