Bitcoin Is Controlled by China, CEO Ripple Says

This is said by Brad Garlinghouse at 2018 Stifel Cross Sector Insight conference
13 June 2018   1013

Concerns about the centralization of mining have been preserved in the community since it became apparent that most of the hash-rate of the network belongs to several mining pools. CEO Ripple Brad Garlinghouse drew attention to the fact that the problem is more ambitious - many large pools are located in China. This is reported by The Street.

A number of prominent people, even Steve Wozniak, has said that he sees a world where Bitcoin is the primary currency. I think that's absurd. I don't think that any major economy will allow that to happen. By the way, it doesn't make sense. I'll tell you another story that is underreported, but worth paying attention to.  Bitcoin is really controlled by China. There are four miners in China that control over 50% of Bitcoin. How do we know that China won't intervene?  How many countries want to use a Chinese-controlled currency? It's just not going to happen.

Brad Garlinghouse

CEO, Ripple

Although this statement may seem sensational, the largest mining pools of Bitcoin like, Antpool, F2Pool and BTC.TOP are really located in China. They account for about 59% of the bitcoin hash-rate. If we add to them smaller Chinese pools, then this country will have more than 75% of the computing power of the network.

BIS to Issue Research on Bitcoin Problems

Researcher from the Bank of International Settlements believes BTC should abadon PoW
22 January 2019   81

Researchers from the Bank for International Settlements published a report in which they stated that only by abandoning the Proof-of-Work mechanism of consensus, Bitcoin could get rid of its current and future problems.

According to them, in the future, when the size of the rewards for mining drops to zero, transaction processing fees alone will not be enough to justify the miners' activities. Consequently, the Bitcoin network will become so slow that it will be impossible to use it, the authors argue.

Simple calculations suggest that once block rewards are zero, it could take months before a Bitcoin payment is final, unless new technologies are deployed to speed up payment finality. 

Raphael Auer

Principal Economist, BIS

The BIS admits that second-level solutions such as the Lightning Network can ease the task, but “only fundamental remedy would be to depart from proof-of-work.” According to the report, the transition to alternative consensus mechanisms “require some form of social coordination or institutionalisation”.

The Bank for International Settlements contributes to the cooperation of 60 central banks from various countries of the world, which account for 95% of global GDP.

Earlier this month, the agency disclosed statistics on central bank initiatives in the field of state digital currencies. According to him, about 70% of central banks conduct research related to the issuance of national digital currencies, but plans for their implementation and the perception of the issue vary considerably in different countries