CEX.IO, the operating exchange for the largest bitcoin mining pool Ghash.io, has issued a new statement to address community concerns regarding the growing amount of the pool’s bitcoin network hashing power.
The post marks the first time since Ghash.io began rapidly approaching 50% of the network’s hashing power that CEX.IO has issued a statement on the mining pool’s growing size and influence over bitcoin’s core infrastructure.
Should Ghash.io reach and maintain 51% of the bitcoin network, the mining pool would theoretically be able to perform certain actions uncontested, such as double spending individual bitcoins, preventing transaction confirmations and obstructing other miners and mining pools from profiting from valid blocks.
Issued via CEX.IO’s website, the pool operator reaffirmed its commitment to the bitcoin ecosystem, stating:
“Our investment, participation and highly motivated staff confirm it is our intention to help protect and grow the broad acceptance of bitcoin and categorically in no way harm or damage it. We never have and never will participate in any 51% attack or double spend against bitcoin.”
Notably, however, CEX.IO also indicated that it is against “temporary solutions” to reducing the threat of a 51% attack, suggesting that should it embrace this type of solution, the underlying problem in the bitcoin network would not be removed.
CEX.IO added: “It also does not address the core issue only pushing the problem a few weeks or months down the road when another pool or perhaps GHash.IO again grows towards 51%”.
To guard against this threat, CEX.IO is proposing a summit of leading mining pools and the Bitcoin Foundation that will aim to collectively address the issue of 51% attacks.
At press time, Ghash.io accounted for 31% of bitcoin’s total hash rate, according to Blockchain.
Mining pool summit
Though details were scant, CEX.IO indicated it is in the process of contacting other leading mining pools and the Bitcoin Foundation, the industry’s leading trade group, to hold a meeting on the issue of 51% attacks.
CEX.IO described the event as a “‘round table’ meeting of the key players, with the aim of discussing and negotiating collectively ways to address the decentralisation of mining as an industry”.
The meeting could happen as soon as 10th-11th July, at the CoinSummit Conference in London, which will unite bitcoin industry leaders such as angel investor Roger Ver, BitGo CEO Will O’Brien and MaidSafe head David Irvine with payments experts such as Stripe’s Greg Brockman.
CEX.IO took aim at its detractors who have suggested that the bitcoin ecosystem could benefit from it taking more immediate steps to discourage miners from joining the pool.
Framing this argument as one that is against the values of fair competition and innovation, the company said:
“In any market, competition and innovation drives growth and that is particularly true in an emerging and disruptive environment such as bitcoin. Successful and innovative companies cannot be expected to limit their growth or competitiveness as a direct result of their success.”
Still, some in the industry have attempted to address the issue in time with recent community concerns.
For example, the news follows the 13th June announcement by industrial mining facility operator BitFury that it would pull more than 1PH/s of mining power from the pool over such concerns.
Reaction to the proposed plan was immediately vibrant on reddit, with detractors and proponents both sounding off on the latest development in what has become a highly publicized issue for bitcoin.
Still, there remains a debate in the bitcoin community regarding the viability of such an attack, with experts aligning on both sides of the issue. The problem may be best summed up by Princeton professor and industry observer Ed Fenton who acknowledged the theoretical dangers of a 51% attack as well as its more practical considerations, stating:
“Concentration of mining power might not be a short-term disaster, but it is unhealthy for bitcoin, and the community needs to address it.”
Image via Ghash.io