Mining has become a heavily centralized industry, not necessarily due to the ownership of actual mining hardware being concentrated, but because of the central dependency on large mining pools to actually coordinate with other miners. This presents a problem on multiple fronts. Pools custodying miners funds gives them the ability to withhold payments and coerce actual miners to behave or act a certain way. The two largest pools require KYC information before allowing someone to mine with them. Large pools can actively censor transactions if they choose, or were mandated to by governments, using the hashrate of their customers.
Pools are a necessary piece of the Bitcoin network, as without them the only option is solo mining. This means very infrequent and random payouts that are highly unpredictable and make planning a high capital business very risky. We need them, in one form or the other, but the current form pools are taking present a growing systemic risk to the success of Bitcoin. They are starting to present threats to the core property that makes Bitcoin such a valuable and desirable system in the first place: it’s censorship resistance.
Ocean announced their launch today as the first mining pool to comprehensively address these growing and worrisome trends in the space. It’s time to fix Bitcoin mining.
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