While the likelihood of a 51% attack on the Bitcoin network remains slim, growing centralization of the mining process is a rising concern and has prompted several equipment manufacturers to seek a solution.
Any one person or collective of bitcoin miners who controls 51% of the computational power behind the network can effectively choose which transactions can be processed, and can also tamper with historical transactions so that a malicious attack would allow double-spending of digital assets.
Data from BTC.com shows that if the four biggest mining pools collaborated, they would control enough share of the network’s hashrate to mount a successful 51% attack.
One Computer, One Vote
Bitcoin’s creator(s) originally envisioned the mining proof-of-work concept as involving one vote per one computer.
However, as mining gear quickly became more sophisticated and the whole mining process developed into industrial pools of centralized transaction processors, the original vision of a decentralized bitcoin faded.
And the bigger these pools become, their ability to negotiate access to cheaper sources of electricity improves, making it more difficult for the small scale miners to compete.
Stratum V2 Protocol
A new mining protocol was announced last week, however, that aims to put the power of veto back with individual miners rather than the mining pool.
To prevent hash rate hijacking, selected protocol messages are cryptographically signed by the upstream pool, allowing clients to authenticate security-critical upstream data.
A Braiins spokesperson talked to Forbes Magazine last week and said:
While we know some large miners have been requesting this feature, we don’t know how many in total find it critical. Either way, it’s completely optional so should this not be relevant for someone, they can leave the transaction selection up to the pool.
The most important takeaway, however, is that individual miners can regain responsibility for transaction selection and take it out of the hands of the mining pool industry, and mining gear manufacturers can share some responsibility here too if they include this protocol in their products’ software.