Study Argues Chinese Mining Centralization Poses Threat to Bitcoin Network
A joint study conducted by Princeton University and Florida International University has found three-quarters of Bitcoin mining is based in China and warned of the potential risks that could result from the significant geographical centralization of the mining network. The study, titled “The Looming Threat of China: An Analysis of Chinese Influence on Bitcoin,” seeks to “explore how China threatens the security, stability, and viability of Bitcoin through its dominant position in the Bitcoin ecosystem, political and economic control over domestic activity, and control over its domestic Internet infrastructure.”
The study opens by describing China as comprising “One of the most powerful potential adversaries” to bitcoin, adding that the country “has expressed adversarial positions regarding the cryptocurrency and demonstrated powerful capabilities to influence it.”
The researchers estimate that “74% of the hash power on the Bitcoin network is in Chinese-managed mining pools,” and seek to explore the ways in which this centralization of mining power can be leveraged by the Chinese government to attack the Bitcoin network.