The chief technology officer of Casa, Jameson Lopp, laid out arguments for a possible loss of China’s lead in cryptocurrency mining. Among them are cheaper electricity and the organisation of chip production outside Asia.
Countering common Bitcoin FUD. https://t.co/Kqiuhlgyum
— Jameson Lopp (@lopp) August 9, 2020
Lopp does not expect rapid changes given China’s current dominance in the sector. He cites data from the Cambridge Centre for Alternative Finance, according to which China accounts for 65% of total Bitcoin hash rate.
“In the long term we will see the industrialisation of countries with lower electricity tariffs and the emergence of large semiconductor production sites outside Asia. Increased competition will create incentives to open mining farms outside China,” Lopp argues.
According to Lopp, China’s current dominance does not pose a threat to network security. The blockchain has plenty of independent observers who would promptly identify any attacker.
“It is hard to imagine that some state structures could organise a continuous attack for several hours. The worst-case scenario of equipment capture would lead to mining empty blocks. Validation of all transactions on the blockchain would thus be halted. In this case, one would have to wait for the attackers to surrender. Or coordinate a change to the code that would render their miners useless,” Lopp suggested.
Jameson Lopp: the worst enemy of a Bitcoin investor in terms of security is himself
The veteran of the cryptocurrency industry emphasised the importance of projects such as BetterHash and Stratum V2, which promote mining decentralisation and greater control by individual participants.
In July, Iranian authorities allowed the country’s power plants to operate with Bitcoin mining centres and other cryptocurrencies, provided they are licensed and comply with the established tariffs.
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