The Plight of the Little Guy
We often hear about Bitcoin being powered by individuals all around the world, in some sort of glorified decentralized utopia. Well, a recent study has shown that 50% of Bitcoin’s Hashrate is actually controlled by two mining pools.
What Does This Mean?
Basically, these two mining pools can set the tone for the Bitcoin network. This could lead to centralization, as decisions about Bitcoin network changes may be heavily influenced by the two large companies.
It also means that small time miners have less of a chance to provide a big contribution to the Bitcoin network – at least in terms of computing power; it will be increasingly hard for them to compete.
What Can Be Done?
This isn’t to say that Bitcoin has been fully taken over by ‘the man’ – there’s still room for independent players to make a difference. Here are a few points to consider when it comes to making sure that Bitcoin stays decentralised:
- Don’t panic – the current situation is far from ideal, but it’s certainly not disastrous. Talk to your friends and family, and raise awareness around which companies are in control of the network.
- Get involved – you can still mine, even if you have a smaller setup. Do your own research and look into the rewards that smaller miners can get.
- Be conscious when investing – when you have money to spend, make sure you thoroughly research the mining companies that you’re investing in. Find out who they are, and who they represent.
Hang in There
At the end of the day, nothing is really set in stone. The power can shift back towards smaller miners at any point, so don’t give up hope. The future of Bitcoin, and indeed all cryptocurrencies, isn’t totally certain – but it sure is exciting.
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