Key Takeaways
- AntPool has mined seven consecutive blocks, sparking centralization concerns.
- AntPool and Foundry USA together control over 50% of Bitcoin's hashrate.
- Recent regulatory scrutiny and energy consumption concerns are adding pressure on Bitcoin miners.
Concerns about Bitcoin mining centralization have resurfaced following AntPool’s remarkable feat of mining seven consecutive blocks.
On May 17, between block heights 843,893 and 843,904, AntPool confirmed over 20,000 transactions in just one hour and thirty-eight minutes, earning 23 BTC—21.875 BTC in mining rewards and 1.283 BTC in fees.
This event has drawn attention to the dominance of major mining pools like AntPool and Foundry USA, which together control over 50% of Bitcoin’s hashrate.
Such concentration of power raises alarms about the potential threats to Bitcoin’s decentralized nature. Foundry USA mined the block before AntPool’s streak and the two blocks immediately after, resulting in ten consecutive blocks mined by these two pools in a single day.
Risks posed by large mining pools
Bitcoin developer Luke Dashjr has long warned about the risks posed by large mining pools.
He argues that centralization could lead to censorship and control issues.
Similarly, crypto analyst TOBTC remarked:
This centralization trend, driven by economies of scale, allows these pools to censor transactions, as seen with F2Pool’s compliance with OFAC sanctions. Such power concentration poses an existential threat to Bitcoin’s decentralized nature and its foundational principle of trustlessness.
The dominance of large pools is largely due to economic realities that make it difficult for smaller miners to compete.
JPMorgan noted that the current hashrate and power consumption have pushed the average mining cost to about $45,000.
Recent regulatory scrutiny further intensifies the pressure on Bitcoin miners.
In the US, President Joe Biden ordered Chinese-backed MineOne Partners Ltd. to halt the construction of a Bitcoin mine in Wyoming and sell the property.
Other countries are also addressing energy consumption concerns, with Venezuelan authorities planning to disconnect crypto mining farms from their energy grid and the Norwegian government focusing on regulating data centers and curbing energy use for Bitcoin mining.
