The idea that because so much mining occurs in China, that Chinese mining pools or the Chinese government can take control of bitcoin, shut bitcoin down or initiate a 51% attack.
“Bitcoin is really controlled by China. There are four miners in China that control over 50% in bitcoin.” Main Stream Media
China drove Bitcoin miners out of China in what has since been termed “the great hashrate migration” in June/July 2021.
While it was always untrue that “China” controlled anything to do with bitcoin, this FUD is no longer relevant.
By now, it should be clear the “hashrate migration” is real: Miners are leaving China for good.
Hypotheses for the motivations behind China’s move to eliminate mining abound, although no single explanation appears sufficient as of yet.
Officially, the justification for the crackdown on “Bitcoin mining and trading behavior” announced in the statement issued by Vice Premier Liu He was to “resolutely prevent the transmission of individual risks to the social field.” If the objective is to curb speculation in cryptocurrency, exchanges would be the more obvious targets.
Other analysts have said China sees bitcoin as a competitor to its own digital currency project, the DCEP. But again, bitcoin mining is a largely self-contained industry.
Banning mining does little to inhibit bitcoin transactions or exchanges – they are totally distinct concerns. Transactions can be assembled and included in blocks anywhere. The Chinese crypto industry would work perfectly well even if all mining was domiciled offshore.
Another popular plausible motive for the ban would be continued efforts to stem unmanaged capital outflows.
Have another better source? Please help us squash the FUD by submitting it.
Squash this FUD
Start an argument