Unknown mining pool nears 50% hash rate, Bitcoin Cash faces threat

On September 2nd, more than half of the Bitcoin Cash (BCH) hash rate appeared to be controlled by unknown miners not affiliated with any known mining pools. While no malicious attacks occurred, it raised concerns about the security of the network.

According to the data from the Coin Dance cryptocurrency data platform, within 24 hours of the incident, only 46.4% of BCH blocks were mined by recognized mining pools, with over 53.4% coming from "other pools."

In contrast, during the same period, only 8.8% of Bitcoin blocks came from unknown miners. As for another Bitcoin variant, BSV, the figure was 36.1%.

Even in the past 7 days, the distribution of mining pools remains highly concentrated, with as much as 48% of blocks coming from unknown mining pools.

When checking the BCH block explorer, the data still appears abnormal, with Bitcoin Cash blocks being mined at an unpredictable rate. Although the BCH protocol is set to produce blocks every 10 minutes, the block explorer displays blocks being mined at almost every minute, even seconds.

During certain periods, Bitcoin Cash miners were producing 18 blocks per hour instead of the expected 6 blocks per hour, making the block production rate three times faster than the protocol dictates.

An increase in block production rate typically indicates a sudden surge in hashing power, such as new miners joining or previously offline miners coming back online.

According to Coindance's hash rate data, there hasn't been a significant influx of miners into Bitcoin Cash. On the contrary, the total hash rate has remained consistent at 2,000 PH/s. The hash rate of known pools is decreasing while the share of unknown pools continues to grow.

A report suggests that this situation may be due to the significantly larger block size of Bitcoin Cash compared to Bitcoin, potentially exceeding the network nodes' bandwidth and storage limits.

Proof of Work (PoW) has long been considered a very secure consensus mechanism. However, in recent years, there have been instances of malicious miners launching 51% attacks on cryptocurrencies like Ethereum Classic (ETC) and Bitcoin Gold (BTG).

In addition to the concentration of hashing power issue mentioned above, Bitcoin Cash seems to have not fully recovered from last year's hash war following a fork, currently ranking fourth in market capitalization and having dropped by 37.58% since July.

Related Reading

• As Bitcoin Surpasses $10,000 Again, Google Search Index Hits All-Time High
• "Bitcoin Jesus" New Cryptocurrency Exchange Launches With No Users Buying

Join now to receive the most comprehensive information on financial technology, blockchain insights, and industry examples!