Carole House, who used to be the White House director for cybersecurity and is now with Terranet Ventures, talked at the DeCenter Spring Conference at Princeton in April about a concerning trend.
She proposed that it would be beneficial if miners and validators from proof-of-stake blockchains could unite and agree not to mine any transactions that are blacklisted by OFAC. Plus, she mentioned that if most of the hashpower is located in the U.S., where miners must follow these sanctions, that could help make this idea a reality.
Now it seems they not only want to stop mining transactions on the OFAC list but also don’t want anyone to build on blocks that include those transactions. Just unbelievable!
By the way, OFAC stands for the Office of Foreign Assets Control in the United States. They're trying to control everything, especially when it comes to bitcoin.
What terrible news. But at least for Bitcoin (and other coin with diminished supply generation) where TX fee will become main miner's income, miner would rather move to different country or shut down their operation rather than operating at loss.
This cannot be controlled using the POW algorithm. Not all mining pools comply with US requirements, and for a good commission, prohibited transactions will be included in new blocks. In Russia, miners will not obey US requirements, so Russian miners will receive more profit.
It doesn't really have anything to do with the algorithm. It has to do with OFAC and sanctions.
The Office of Foreign Assets Control ("OFAC") of the US Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States.
https://ofac.treasury.gov/sanctions-programs-and-country-information/russia-related-sanctions
So you open a pool in El Salvador. they say fuck you BTC is our currency we accept all transactions..
A usa mine would be banned from that pool.
Or would they mine to a proxy via tor. And let all coins sit in a virgin wallet address.
If anything smaller miners will be nimble and the big mines could suffer.
or Donald mother-fucking Trump gets in and the gov goes in another direction.
Thats not how it works. You can operate the machines to different locations. Also, Group B can still mine txns if Group A decided to not mine. Group B will get the rewards.
Learn how mining works
That would work for time being. But for U.S. miners, they have to hope government won't create new law which prevent them from doing that.
You missed OP's point. He emphasize about U.S. government idea not to build block on top of block which include blacklisted TX/address which possible if 51% hashrate comply with U.S. government idea.
yeah, i mean, that's kind of a new idea of attacking bitcoin is to try and make people criminals who build on top of a block that has a blacklisted address. since bitcoin is only pseudoanonymous, usa-based bitcoin miners would need to either build on the usa government's recommended chain or figure out a way to launder their BTC through monero or something so they don't get caught. i guess it all depend on how much hash power they could get under their control as to if bitcoin could survive that or would it split into 2 chains?
they could make a rule preventing that in one sentence. "If you contribute hashing power to a pool that mines on top of a block that has a blacklisted address, then you are breaking the law." simple as that. not that they would even need to because that would be completely understood. not every law is spelled out in all the things that you are not allowed to do. some of them are just common sense.
In short, they are nicely asking for a hard fork, as the current hashrate percentage is not enough for them to make the OFAC list mandatory. However, if the United States puts pressure on all countries of the world, the percentage of unknown mining pools is less than 2%. If all governments were united, passing such regulations would be easy.
The big question remains: If governments do not unite at the climate summit, something that harms humanity, will they unite in creating a blacklist of addresses for Bitcoin?
probably. although they don't just want their own version of bitcoin, they want to kill the other version of it so that there is only one bitcoin and it is firmly under their control. then expect them to put in some type of "freezing function" so they can freeze any bitcoin address they want.
the list will just get bigger and bigger, having more categories of what a bad person is. got too many speeding tickets that are unpaid then they might put your addresses on the list. that type of thing. they don't care about the environment as much as you might think. what they really care about is controlling the people and you can't do that without controlling their access to money or its equivalent.
in the usa government's version of bitcoin, there will be 2 types of bitcoin addresses: KYC addresses and no-KYC addresses. they'll want an ID for every bitcoin address. the ones that don't comply will just be frozen.
If this is enacted, it certainly beats the main purposes behind Bitcoin (to some extent some partially happened already):
- decentralization
- no censorship
- and maybe... pseudonymity (not anonymity)
The especially chilling part is where with over 51% hash power, banned (or approved, as you like) transactions will not get
approved days and maybe weeks. As well as not building new blocks above the block containing banned transactions.
Wow, just wow.
Even actual hard fork is hard to pull since it require Bitcoiner to update/change their full node software and some business to update their custom software.
And that's when Bitcoin might die.
This is a very interesting topic, as I've been discussing a catastrophe scenario like "Block Compliant Vs Block not Compliant" and the repercussions this would have on Bitcoin as a whole with others in the local section for a long time.
Unfortunately I'm sad to see that this is the direction it's going to take potentially.
I wonder what role Stratum V2 could play, and if it were to be used, whether pools (US pools for example) could decide to not pay for "not compliant" blocks etc...
Perhaps some individuals desire a complete economic overhaul, wishing they could participate from the outset to influence asset distribution like Bitcoin's supply. Given its current value and widespread ownership, however, achieving such control seems unlikely.
There's no thing such as validator on Bitcoin. All nodes Bitcoin perform verification, but none of them have authority to tell all other nodes that certain block must be ignored.
Definitely all states and governments will try to censor Bitcoin and cryptocurrencies as much as they can, through whether incentivies or penalties!...But tech cannot be stopped...There are currently Bitcoin-related solutions being worked on in the Bitcoin community, so that it brings high level of privacy into the Bitcoin TXs. For example ZK-rollups for Bitcoin is one solution. It's just matter of time and advocate of the community that make this happen sooner or later. Bitcoin layer-2 solutions are what we really need to support and promote in crypto space bcuz they can bring new set of solutions and tools that will help other developers to innovoate more in this space and even help them enhance the privacy of TXs....So a lot of hope in the space!
If Zk-rollups can be settled on Bitcoin ecosystem then you cannot easily distinguish TXs and labeling them!....Privacy is not a crime!(It's not dodging law/regulations!).. And it's people right to deploy any tools to keep their privacy as mush as they can.
There are a lot of miners, and when there are enough transactions with high commissions in the mempool, the miners will organize a solo pool to mine such a block, and then switch back to the main pools. This is a crappy POS algorithm, where everything is decided by the consensus of validators.
A few simple points:
1) Even if it does happen, it wont be Bitcoin, so it wont matter.
A fork of Bitcoin is not Bitcoin.
Bitcoin works no matter what the price, and even a large drop in hash rate has no real effect on that - as expected, and as we saw, when china shutdown mining.
2) The magic 51% number rears it's head yet again
Pools mining against lower points in the active chain will be obvious.
So it would become immediately clear what pools not to mine on.
Excluding higher paying transactions means less mining reward in your block.
Excluding the lowest paying transactions, when block space is at a premium, is how Bitcoin works.
Messing with that means less bitcoin reward for mining.
(Which is what StratumV2 is trying to make happen - stay away from V2 - they're probably backed by the gov't since they are helping to do this)
3) It's the current us gov't that's trying to damage Bitcoin, not sure why anyone in Bitcoin would want to keep them in power lol