Jameson Lopp has drawn the attention of China to the fact that they may soon relinquish their number one position in Bitcoin mining to other countries where chips are now being mass-produced and electricity is supplied at a cheaper rate.
Jameson Lopp, a cypherpunk, said in a recent blog post that China may soon be overtaken by other countries with cheaper electricity and more mining chips as the best in bitcoin mining.
Lopp said China’s dominance stems from the fact that Asia produces mining chips in large quantities and miners enjoy cheap power supply. But he now thinks:
“Over the very long term I expect we will see semiconducter foundries outside of Asia begin producing more mining chips and countries with even cheaper power sources will continue to become more industrialized, thus providing more competition when miners are seeking out new locations to set up shop. China’s mining dominance is unlikely to last.”
According to Lopp, taking away mining from mining pools makes individual hashers to also stay in business. He mentioned that Stratum V2 and Betterhash have the same aim of decentralizing Bitcoin mining.
Lopp is, however, confident that China won’t be able to influence Bitcoin activities on a global scale even though it has much of the mining capacity. He says Bitcoin is too big for any single entity to implement a selfish interest and that with bots currently in place to observe orphaned blocks, nothing can happen unnoticed:
“It’s hard to imagine a scenario in which a state actor would be able to quickly and covertly seize enough hashpower to perform an ongoing attack that lasts more than a few hours. A worst case scenario in which state actors did seize all of the physical equipment could result in China only mining empty blocks and orphaning other blocks that did contain transactions, essentially halting all transaction confirmations on the network. Then it would become a game of either patiently waiting for them to give up or coordinating a code change that would make their hashing machines worthless.”
Other countries are indicating interest in Bitcoin mining. An example is the recent wake of Iranian government to the mining industry when it supported a mining strategy for the entire country. It should be noted that Iran has a good supply of cheap electricity too.