Bitcoin's value proposition depends on its ability to resist any form of censorship. Without this feature, Bitcoin loses its power to challenge and oppose any authority that wants to put Bitcoin under the same rules that apply to the traditional world. With this in mind, it is very important that bitcoin has no major points of failure. If there is a gatekeeper, there is vulnerability. If there is a vulnerability, it will be exploited. And at that moment, Bitcoin as a free and decentralized cryptocurrency simply stopped.
To ensure the network's decentralization, robustness and immutability, we must maintain the very components that will prove to us, through time-tested battles, of these very properties. No entity in the world can feel like an attack on Bitcoin will be a successful attempt. The best way to do that is to spread Bitcoin as far as possible to all corners of the world by running nodes. Just like a money virus. The more it spreads, the higher the chance of success.
Satoshi mentioned several times that all previous electronic money projects failed due to their centralized features. A monopoly on the money supply is a power that governments and the financial system will not let go easily. To ensure that Bitcoin is not stopped by a bad actor, it is our duty to ensure that the decentralization of Bitcoin increases all the time. Forever.
Many people automatically dismiss e-money as a lost cause because of all the failed companies since the 1990s. I hope it is obvious that it was the very nature of these systems that were centrally controlled that they did. I think this is the first time we are trying a decentralized system, which is not based on trust.
Bitcoin's open source implementation of P2P currency
https://www.fbi.gov/charlotte/press-releases/2011/defendant-convicted-of-minting-his-own-currencyhttps://www.indianapolismonthly.com/news-and-opinion/business/mad-money/
Looking in detail at what Bitcoin has achieved so far and where it is now as a global network, it is a fact that the network is very decentralized. Nevertheless, just as one can argue that bitcoin's purchasing power has no ceiling, bitcoin's degree of decentralization also has no ceiling. The bigger, the better! Beyond a certain level of decentralization, any attack on Bitcoin is not only useless for the attacker, but also harmful, because the failure of the attacker ends up confirming the ability of bitcoin to stand against any attack, strengthening the network in the process, while at the same time reducing any success. an attempt to attack Bitcoin. Anti-fragility in its purest form!
Hydra – a mythical figure from the Book of Revelations. Every time one of the heads was cut off, the Hydra would get two heads back. Each time the Hydra was attacked, the Hydra became stronger. The Hydra is fragile. Bitcoin is a monetary Hydra.
What level of decentralization ensures that any attacker is completely discouraged from attacking the network? Nobody knows for sure. We can only guess at it. Regardless, the best strategy is to simply decentralize bitcoin as much as possible. And the most important tool we have is to run as many nodes as possible around the world.
Nodes perform one of the biggest, if not the most important role in Bitcoin. By following the rules of the protocol, they confirm and verify all transactions and all the blocks that are transferred throughout the network. They also provide this information to other nodes and store all blocks published by miners. If a transaction, block or other piece of information violates the protocol's consensus rules, nodes automatically reject it. Nodes are essentially the referees of the bitcoin game, making sure everyone is playing fair as they should.
Bitcoin nodes working
If more nodes join the network, more referees verify everything that happens in Bitcoin. If more nodes join the network, there will be more copies of the entire blockchain. If more nodes join the network, there will be more assurances that all actors will behave properly. Every time a node joins the bitcoin network, anyone who wants to attack has to cut off an extra head to kill this silver Hydra called Bitcoin. If you're not running node yet, it's time to do your part.
Unfortunately, and unbeknownst to most bitcoin users, most miners do not ran node today. Giving valid shares to the pool operator is all that is necessary to pay for their work. It is commonly said that miners are paid by the network to protect it from all hostile attacks by building a wall of energy so dense that it is impossible to penetrate. . However, if we want to continue with this analogy, what we see is that miners are the workers of the pools, not of the bitcoin network. There is no direct connection between miners and the network. Miners are effectively selling computing power in the form of hashrate to the pools. The responsibility for choosing the transactions that go into the block, creating the blocks themselves, moving those blocks found throughout the network and getting its all necessary information delegated to the pools. This effectively means that Pools are the ones censoring, or not, the network thus undermining Satoshi's original vision of an open and permissionless protocol for the transfer of value.
Additionally, if the level of decentralization wasn't reduced enough just by that, there are proxy pools. Proxy pools are wolves hiding in sheep's clothing. Same pool, but different brand. This means that if some large Pool A has 20% of the Hashrate, but 3 smaller pools B, C and D have 5% each, Pool A effectively controls 35% of the hashrate. That would be enough for a selfish Mining attack and damage the network. So, what we end up with is only “master” pool nodes deciding which transactions make it to the blockchain. This situation does not appear to be very decentralized. That's because it isn't. Fortunately, there is a way to fix this. It's called Stratum V2.
Stratum V2 is a new mining protocol that hopes to introduce a series of new features that will make Bitcoin mining more secure, more efficient and of course, more decentralized. Its reference open source implementation was developed by an independent community group of over 15 developers over the past three years, battle tested with over 30 000 downstream. With this new protocol, Bitcoin decentralization can reach new heights. How, you may ask? By enabling miners to create their own block templates and choose the transactions included in blocks. To have this ability, miners must run a node. More nodes mean a more decentralized and stronger network. Once all miners are the building blocks rather than pools, we will finally see Bitcoin take another step towards incredible decentralization.
The DEMAND pool is the first mining pool to implement the reference implementation of the Stratum V2 protocol. Our mission is first and foremost, to contribute to the decentralization of the network and end the threat of censorship on Bitcoin. If you are a miner and want to be in the driver's seat, consider joining our pool. Special lifetime conditions and other features will be available to founding members of our pool.
It's time to improve Bitcoin's decentralization. are you coming
This is a guest post by Francisco Monteiro. Their views are entirely theirs and do not necessarily reflect the views of BTC Inc or Bitcoin Magazine.
