On-chain evaluation now reveals {that a} single nameless custodian, believed to be Cobo Custody, performs an important function within the Bitcoin community. In a submit on X, one analyst mentioned the custodian controls the Coinbase addresses of no less than 9 mining swimming pools, cumulatively contributing no less than 47% of the entire hash price.
Which means that for each 100 freshly mined BTC, 47 BTC are despatched to this custodian. Concentrating management in a single entity raises issues in regards to the potential dangers and the necessity for transparency and decentralization of custodians amongst mining swimming pools.
Bitcoin Mining Pool Overreliant On One Custodian
The discovering famous that standard Bitcoin mining swimming pools like AntPool, F2Pool, Binance Pool, Braiins, btccom, SECPOOL, and Poolin channel their Coinbase to the identical custodian. Moreover, ULTIMUSPOOL and 1THash’s Coinbase addresses are additionally reportedly managed by the identical entity.
Luxor beforehand used the identical custodian however modified its setup after it was famous that additionally they relied on the custodian.
A Coinbase deal with is a particular deal with related to a mining pool. At any time when a mining pool succeeds in confirming a block of transactions each 10 minutes and is rewarded with 6.25 BTC within the present epoch, it sends these cash to its Coinbase deal with.
This consolidation raises issues about centralization in coin storage. Technically, Bitcoin is powered by a decentralized net of miners, none of which management over 50% of the entire hash price.
The hash price is the measure of computing energy devoted to the community. The upper it’s, the safer the platform turns into towards assaults. Based on YCharts, the Bitcoin community at the moment has a hash price of 603 EH/s.
Safety And Centralization Dangers
Recent research present {that a} single entity controls almost half of all newly minted BTC, which might pose a safety threat. If this custodian is compromised, these mining swimming pools might lose closely, impacting the community’s total safety and sentiment.
Apart from counting on one custodian for his or her Coinbase, the examine additionally discovered that the 9 swimming pools present a hash price for AntPool’s transaction accelerator service. The custodian is alleged to ceaselessly use AntPool and ViaBTC’s transaction acceleration providers for giant batch withdrawals.
Normally, transaction accelerators are supposed to fast-track the affirmation speeds of sure transactions. Whereas handy, particularly when the community is congested, accelerators can threat centralizing management over transaction processing.
Function picture from Canva, chart from TradingView