An increasingly large portion of Bitcoin's (CRYPTO: BTC) hash rate is managed by publicly-traded companies, a development that was hardly expected from a technology that was meant to be anti-establishment with radically individualist ideas.
What Happened: A report recently published earlier this week by Arcane Research shows that publicly-listed firms are now responsible for 19% of Bitcoin's total mining hash rate — up from just 3% back in January.
See Also: HOW MUCH DOES IT COST TO MINE CRYPTOCURRENCY?
Hash rate is the term used to indicate the rate at which given hardware can perform the calculation involved in cryptocurrency mining — the higher the hash rate, the more a miner earns. The higher the hash rate of any given blockchain, the harder it gets for any actor to gain control over the majority of the network’s processing power. If anyone were to control most of a blockchain's hash rate, then they could carry out a so-called 51% attack.
At the beginning of last year, there were not many firms involved in Bitcoin mining, but right now there are 26 separate public companies that mine the coin. The increase was largely driven by companies already involved in this industry going public. According to the report, the growth was driven by public firms having greater access to capital which allows them to expand their mining farms faster than private companies.
Furthermore, data gathered by the Cambridge, Bitcoin electricity consumption index shows 44.95% of the total global Bitcoin hash rate originates from North America. With the projected increase in target hash rate among public firms, this number is expected to increase and lead Bitcoin to increasingly greater centralization.
