TFTC: A Bitcoin Podcast Risks of Mining Pool Centralization | Jimmy Song, Center of Hash E008
11 snips
Sep 16, 2025 Jimmy Song, author of Programming Bitcoin, dives into the pressing issue of mining pool centralization and its implications for Bitcoin's future. He highlights how a few dominant pools can threaten censorship resistance and alter network rules. The conversation shifts from light-hearted anecdotes about brisket to the serious risks of manipulating Bitcoin's supply and the challenges faced by smaller miners. Song emphasizes the need for more miners to engage directly with the network to foster decentralization and maintain integrity amidst growing pressures.
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Pools Control Block Construction
- Mining pools centralize block-construction because pools provide block templates and payouts on behalf of many hashers.
- This makes block content decisions concentrated in a few operators rather than distributed across individual miners.
Censorship Risk From Few Operators
- A cartel of large mining pools could censor transactions or demand exorbitant fees if they coordinate block inclusion policies.
- Such cartel behavior is feasible because a small number of pools control most of the hash rate and block templates.
Filter vs. Invalidating Transactions
- Filtering transactions (e.g., OFAC list) differs from declaring them invalid; the latter can cause a soft fork and risk chain splits.
- If miners mark transactions invalid, they can create a tightening of rules that risks wipeouts if they gain a longer chain.
