Bitcoin developer Luke Dashjr raises concerns about centralization of Bitcoin mining.
In an in-depth interview with Bitcoin Magazine on January 24, Bitcoin Core developer Luke Dashjr expressed significant concerns about the increasing centralization of Bitcoin mining.
Dashjr believes that the dominance of a few large mining pools poses a serious threat to the decentralized nature of Bitcoin, potentially leading to censorship and control issues within the network.
Control of 11 mining pools
Dashjr said a few large mining pools currently dominate Bitcoin mining and provide most of the computing power used to secure the Bitcoin network.
These pools may each have different shares of the total network hash rate. Notable mining pools include AntPool, Foundry USA, F2Pool, Poolin, and Binance Pool. The exact distribution changes over time due to a variety of factors, including changes in pool capacity and the emergence of new mining pools.
The core of Dashjr’s concerns lies in the disproportionate influence these pools have on the blockchain. He argues that this centralization could allow these entities to have undue influence over transaction confirmations, undermining one of Bitcoin’s core value propositions: censorship resistance.
Dashjr said Ocean Mining was launched to counter some of the centralization of Bitcoin mining. Ocean aims to shift the balance of power from a few large pools to individual miners by enabling block creation.
Dashjr says this approach will promote a more democratic and decentralized mining process where decisions are not centralized within a few powerful entities. He emphasized that while decentralization is difficult, especially given the natural tendency towards centralization for efficiency and profit, it is essential for the health and integrity of Bitcoin.
energy consumption
The interview also touched on the frequently discussed topic of Bitcoin’s energy use.
Dashjr compared the energy consumption of Bitcoin mining to everyday household appliances such as clothes dryers to provide perspective on energy needs. He argued that the value and principles offered by decentralized cryptocurrencies such as Bitcoin should be weighed against their energy consumption.
Dashjr discussed Bitcoin’s future applications, suggesting that Bitcoin’s relevance and usefulness continues to grow in various sectors. He pointed out that Bitcoin’s evolution is an ongoing process that paves the way for its broader use as a currency through its value storage and remittance functions.
Dashjr emphasized the need for better accessibility, user interface, and education in the Bitcoin ecosystem to encourage wider use and understanding of Bitcoin features, including the importance of transaction verification across full nodes.
