Although the huge hashrate of bitcoin presently concentrated in North America may seem to be China 2.0, the truth seems to be more complex. Decentralization is one of the major cornerstones of Bitcoin’s value proposition. Therefore, why does the computational power that powers the world’s biggest cryptocurrency seem to be converging yet again, this time on North America? The answer is complex, but some of the primary factors boil down to where it is safest and most economical for miners to operate in the present geopolitical situation.
Power at a low cost and the rule of law
One of the most important factors for anybody starting a company, especially in such a nascent area as crypto mining, is having the confidence that a whole sector will not be plucked or disturbed by the state immediately. With its constitutional safeguards and national government, the United States is perhaps the best neighborhood for mines to set up a business. Because the United States’ federal system assures a robust rule of law and powerful states’ rights.
Bitcoin mining and self-interest
Geographical dominance and mining pools’ disproportionate marketplace percentage of overall hashrate seem to be a danger to decentralization. However, as soon as the miners’ objective is revenue, attacking the infrastructure by teaming up would be pointless. “To get to the point about a danger to decentralization,” Harper said, stressing that miners compete against one another and would still not make money from working together to undermine the system that offers their revenue.