© Reuters.
The mining landscape is under intense scrutiny amid concerns over Antpool and Foundry USA’s growing dominance of the network’s hashrate. Recent discussions have highlighted the implications of their combined 56% control, raising questions about the potential centralization of Bitcoin mining and its future regulatory environment.
Crypto analyst Chris Blec sounded the alarm about the influence of the two mining pools on Wednesday, suggesting their dominance could pave the way for Bitcoin mining to become a regulated industry, with membership strict to “Know Your Customer” (KYC) guidelines. This development could allow governments to exert significant control over a majority of miners, which would alter the decentralized nature of Bitcoin mining.
In response to these concerns, crypto researcher Jon Black argued that Antpool and Foundry USA’s dominance is explained by their compliance with existing regulations. Any abandonment of this compliant behavior would likely result in a redistribution of hashrate to smaller, non-KYC-compliant pools, he said. Mr Blec rejected this view as purely theoretical, which opened a new debate on the issue.
The conversation also touched on the role of Stratum mining software versions in determining how mining pools operate. Stratum v1, which is currently favored by many miners due to its user-friendly nature, allows pool operators to select transactions for block mining, while individual miners contribute computing power without having any influence directly on the selection of transactions. In contrast, Stratum v2 introduces “Job Negotiation”, which gives more autonomy to individual miners by allowing them to choose transactions for their block models.
A report published by Galaxy.com in 2022 highlighted the division within the industry regarding Stratum software releases. This report highlights the existence of a significant divide between ASIC manufacturers and software developers, and highlights concerns related to the centralization of mining. This division raises crucial questions about whether current practices within Bitcoin mining pools are sufficient to maintain the decentralized ethos that is central to Bitcoin’s philosophy.
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