Bitmain founder Cihan Wu commented on the centralization of the Bitcoin Cash crypto currency mining
Bitman founder Cihan Wu took part in the Subreddit forum, in which he responded to a comment made by a researcher named Justin Bons. He wrote about the centralization of Bitcoin Cash mining, saying that the increase in the block size is not the reason for the increase in the level of centralization. Rather, it is related to a hashreit belonging to individual mining pools.
"To eliminate the centralization of the Mining Pool, you can take advantage of the shortening of the block creation time, given that pools must provide PPS mode to their customers because of popular hash behavior. Pools then carry the risk of volatility in the extraction of blocks, but payments to customers are at a stable rate. Therefore, pools must have a very large capital to begin with, which is a kind of centralization pressure. "
Bones also wrote that it is not the miners that run full nodes, but rather the mining pools. According to him, this scenario is similar to a free market of pools or representative democracy for miners, where the service can switch its miners to another service in seconds, resulting in a change of voice.
When asked to explain how the miners may not start full nodes, Bons explained that they all, including modern ASIC devices, can only work if they are directly connected to the pool. Further, he added that the problem of centralization does not revolve around extraction, but rather around the pools themselves. He wrote:
"There is no centralization of production. It's more a matter of centralizing the pool. "
The current situation is due to the fact that more than 50% of the hashtraite is managed by two mining pools in the Bitcoin Cash network: BMG Pool and Coingeek.
Bitmain, which is based in China, is seen as a threat to Bitcoin's [BTC] crypto currency environment, as the company is reported to be approaching 50% of all hash capacity. This creates a devastating threat to the Bitcoin ecosystem, in which Bitmain can have sufficient hash power to launch a 51% attack on the network in the future.
Author: Olga Novikova, analyst of Freedman Club Crypto News
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