Researchers demystify centralization in cryptocurrency mining

phys.org | 4/30/2019 | Staff
ziggy1023 (Posted by) Level 3
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Blockchain technology has been considered as the most revolutionizing invention since the internet. Due to its immutable nature and the associated security and privacy benefits, it has attracted the attention of banks, governments, technology corporations, as well as venture capital.

To participate in the blockchain consensus mechanisms, prospective network nodes—also called miners—need to provide proof of some costly resource. This resource may be computational power in protocols with proof of work mechanisms or cryptocurrency coins in proof of stake mechanisms.

Assumption - Security - Philosophy - Blockchains - Network

An integral assumption in the security philosophy of public blockchains is that the network of mining nodes remains sufficiently decentralized and distributed. In the extreme case, sufficiently means that no single entity holds 50 percent or more of the resources, but in practice, much more decentralization may be desired to safeguard the underlying protocol.

However, available data demonstrates that mining resources are much more centralized than originally thought, leading essentially to...
(Excerpt) Read more at: phys.org
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