Bitcoin Mining Centralization Sparks Security Debate as Alternative Networks Evolve

Bitcoin Mining Centralization Raises Security Concerns

Recent data has sparked significant debate among experts regarding the security of the Bitcoin blockchain. According to BeInCrypto, two major mining pools, Foundry and AntPool, now control over 51% of the total Bitcoin hashrate. Specifically, Foundry holds a market share of 33.63%, while AntPool accounts for 17.94%. This concentration means that, together, these pools surpass the critical 51% threshold, raising the specter of a potential 51% attack.

This is the first time in over a decade that mining concentration has reached such a precarious level, shaking the community’s confidence in Bitcoin’s decentralization. Some community members and analysts, such as Jacob King, have openly acknowledged that Bitcoin mining has become “extremely centralized.” Statistics from Evan Van Ness indicate that three mining pools frequently control over 80% of the global hashrate.

A 51% attack would theoretically allow these pools to manipulate transaction validation, block or reverse confirmed transactions, and enable double-spending, thereby threatening the integrity of the Bitcoin network. While the costs and logistical challenges of executing such an attack remain high, the mere perception of vulnerability is enough to unsettle investors and raise concerns about systemic risks.

• Mining concentration at a ten-year high
• Experts question the long-term viability of Proof-of-Work (PoW) as the backbone of the global financial system
• Potential for a 51% attack, though economically and logistically challenging

“Sobald die Realität einsetzt, wie zentralisiert, manipuliert und nutzlos Bitcoin wirklich ist, wird alles schneller zusammenbrechen als je zuvor. Es ist im Wesentlichen ein riesiges Spiel der Reise nach Jerusalem!” – Jacob King

Infobox: The dominance of Foundry and AntPool in Bitcoin mining has reignited fears of centralization and potential network manipulation, despite high attack costs and logistical barriers. (Source: BeInCrypto)

The Shifting Landscape of Crypto Mining Beyond Bitcoin

The transition of Ethereum from Proof-of-Work (PoW) to Proof-of-Stake (PoS) on September 15, 2022, marked a pivotal moment in the crypto mining sector. As reported by CoinShares, Ethereum’s PoW network peaked at approximately 1.24 PH/s in mid-June 2022. When the Merge occurred, over 1.2 PH/s of GPU mining capacity went offline, prompting a mass migration of hashpower to other PoW chains.

The primary beneficiaries of this migration were Ethereum Classic, Ravencoin, Ergo, and Flux, each experiencing dramatic increases in hashrate:

Freed GPUs could not switch to Bitcoin due to its reliance on ASIC chips, making GPU mining unprofitable. Instead, miners adopted GPU-friendly algorithms such as Ethash (Ethereum Classic), KAWPOW (Ravencoin), Autolykos v2 (Ergo), and ZelHash (Flux).

The report also highlights the emergence of new PoW hotspots. Paraguay, for example, has become a South American mining hub, hosting up to 1.45% of the global hashrate in mid-2025, thanks to low hydroelectric rates from the Itaipu Dam. Kazakhstan and several African countries, including Ethiopia, Kenya, and Nigeria, are also leveraging local renewable energy sources to power mining operations.

• Kaspa positions itself as “digital silver” to Bitcoin’s “digital gold,” using the GHOSTDAG protocol for fast transaction speeds.
• Monero emphasizes privacy and uses the RandomX PoW algorithm.
• Ravencoin and Ergo focus on GPU mining and decentralized applications.
• Flux powers a decentralized cloud infrastructure with over 13,500 nodes.

Mining profitability now depends on token price, network difficulty, and electricity costs. While ASIC-based Bitcoin mining remains viable at scale, GPU mining is more sensitive to market fluctuations. Many miners are repurposing hardware for dual-use applications, such as machine learning, to improve capital efficiency.

1. Externally verifiable work ensures security and prevents manipulation.
2. Censorship resistance is built into PoW, making attacks economically unviable.
3. Permissionless participation reduces centralization risks.
4. Bitcoin’s hashrate, exceeding 0.8 Billion TH/s, demonstrates PoW’s resilience.

Infobox: The Ethereum Merge triggered a redistribution of GPU mining power, fueling growth in alternative PoW networks and driving innovation in mining economics and energy sourcing. PoW remains the most battle-tested consensus mechanism, with Bitcoin’s hashrate surpassing 0.8 Billion TH/s. (Source: CoinShares)

BlockDAG: A Hybrid Approach to Blockchain Scalability and Security

The blockchain industry continues to evolve, with users and developers demanding systems that are both secure and scalable. According to BeInCrypto, BlockDAG offers a hybrid solution by combining a Directed Acyclic Graph (DAG) structure with the traditional Proof-of-Work (PoW) consensus mechanism.

Unlike classic blockchains that validate one block at a time, BlockDAG’s architecture allows for the simultaneous confirmation of multiple blocks. This parallel processing reduces wait times and increases throughput, while PoW ensures the network remains decentralized and secure.

BlockDAG is fully compatible with the Ethereum Virtual Machine (EVM), enabling developers to use familiar tools such as MetaMask, Truffle, and Hardhat, and to write smart contracts in Solidity. For non-programmers, BlockDAG provides a no-code environment for creating smart contracts, issuing tokens, and generating NFTs. A software development kit (SDK) and testnet environment are also available for application development and optimization.

The BlockDAG testnet is already operational, allowing users to mine BDAG tokens via the X1 Mobile Miner App, view live data through a blockchain explorer, and test smart contracts in a secure environment. Its high scalability makes it suitable for both consumer applications like DeFi tools and NFT platforms, as well as institutional solutions such as payment protocols.

• DAG structure enables faster data flow and lower latency under high load.
• PoW consensus maintains security and trustlessness.
• EVM compatibility facilitates easy migration and development of new applications.
• No-code tools broaden accessibility for non-developers.

Infobox: BlockDAG’s hybrid DAG-PoW model delivers high performance and security, supporting both developer and non-developer use cases through EVM compatibility and no-code tools. (Source: BeInCrypto)

Sources:

• Ist die Bitcoin-Blockchain noch sicher? Experten warnen vor 51%-Angriff
• Jenseits von Bitcoin: Die wandelnde Welt des Krypto-Minings
• Was ist BlockDAG? Ein technischer Überblick über die DAG-PoW-Hybrid-Blockchain