With the fourth Bitcoin halving happening just last Friday, a lot of discussion has been happening on the state of the Bitcoin miners. While big players with deep pockets continue to invest in new mining equipment, small players get crushed as rewards drop by 50%. On the other hand, the Bitcoin Ordinals founder also exposed the state of decentralized mining that looks broken as of now.

Antpool Proxies Dominate Decentralized Mining

Casey, the founder of Bitcoin Ordinals, underscores Bitcoin’s fundamental value proposition, emphasizing its reliance on censorship resistance, achievable through decentralized miners vying to create blocks.

Expressing concerns over the current state of Bitcoin mining decentralization, Casey highlights a disheartening scenario. He notes that numerous major pools, once believed to operate independently, now appear to function as proxies for AntPool, adopting similar trasaction selection policies.

As we know, the Bitcoin mining industry is concentrated among a few big players in the market. The same is true for Bitcoin mining chip providers with Bitmain capturing a lion’s share in this market.

However, Jack Dorsey’s Block Inc. recently released good news that they have completed the development of the Bitcoin mining chips, an inclusive effort that caters to miners of all sizes. As these chips are crucial for constructing highly advanced computers, the three-nanometer chip could play a significant role in the rapidly growing mining sector.

Stratum V2 Comes To the Rescue

Bitcoin Ordinals founder Casey announced the introduction of Stratum V2, an upgraded version of Bitcoin’s pooled mining protocol. Unlike its predecessor, Stratum V2 empowers miners, not the pools they mine for, to select the transactions to be included in each block.

This groundbreaking development enables miners to participate in pooled mining while retaining control over block construction. After extensive development, Stratum V2 is now nearing completion and entering a phase of rigorous testing.

Casey urged miners to allocate resources for experimenting with Stratum V2, directing them to @DEMAND_POOL, a Stratum V2 mining pool, to evaluate its functionality and report any issues encountered.

Bitcoin’s entire value proposition rests of censorship-resistance, which can only be guaranteed by decentralized miners competing to produce blocks.

The current state of Bitcoin mining decentralization is, unfortunately, not great. Many large pools which were previously thought… https://t.co/nziWpBaN2r

— Casey (@rodarmor) April 24, 2024

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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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