Bitcoin in danger as we are ‘one chess move away’ from ‘big problems’

When Satoshi Nakamoto designed Bitcoin (BTC), they primarily based its safety on a consensus mechanism known as Proof-Of-Work (PoW). Nonetheless, given its consensus decentralization present standing, Bitcoin’s safety could be in peril.

No less than, that is what the crypto researcher Chris Blec thinks, in response to a post on X on December 14:

“This isn’t chart. 2 mining swimming pools (each of them drive all miners to KYC) comprise 55% of the Bitcoin hash charge. We might be one chess transfer away from some large issues for Bitcoin. However even worse is the truth that no one actually desires to speak about it. The place’s the urgency?”

— Chris Blec

Notably, the talked about chart reveals Foundry USA and AntPool with 27.6% of Bitcoin’s international hashrate every. Each Bitcoin mining swimming pools are Bitcoin mining companies’ cooperatives searching for to enhance block discovery and, consequentially, their income.

Extra than simply pointing to the worrying dominance of two swimming pools on Bitcoin’s consensus, Chris Blec additionally calls the neighborhood out on a lack of understanding about this downside. Curiously, Finbold reported about it on September 23: “​​This is how centralized Bitcoin mining has become over the years.”

Why does Bitcoin mining pool centralization matter?

As it’s immediately, Bitcoin mining swimming pools work centralized within the pool’s coordinator. It’s the coordinator who creates the block template (including transactions from the mempool), filters undesirable transactions, discovers the following block utilizing their miner’s hashrate, broadcasts the mined block to the community, collects the mining reward, and distributes it proportionally to the miners.

Due to this fact, it’s this single entity that performs the related actions that straight impression Bitcoin’s safety. Not too long ago, we have now seen mining swimming pools arbitrarily deciding to not pay their miners on particular events. Particularly, F2Pool and AntPool – each with 8.8% and 27.6% of the worldwide block discovery charge, respectively.

In one more episode, a newly created Bitcoin mining pool was additionally accused of deliberately filtering privacy-related BTC transactions.

Basically, these occasions proof the significance of getting a decentralized pool-based consensus. Furthermore, a Bitcoin Core developer defined why BTC transactions should wait two hours to be considered safe. Additionally affected by the present state of low decentralization.

All issues thought-about, Bitcoin’s worth proposition is straight associated to its safety and decentralization. It’s doable that the present state of the community might intrude with the market’s notion of the worth of the main cryptocurrency.

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