Bitcoin based in China mining giant and chip maker ASIC – Bitmain – has landed in another controversy.
Its Antpool subsidiary, known as one of the largest Bitcoin Mining Reserves in the world was found in hot water after realizing that the company was burning a portion of Bitcoin Cash operating expenses (BCH). sending them to a "black hole address" – a move that many have since seen as a blatant attempt to artificially raise the price of the BCH.
"[I] nvestors may have noticed that Antpool has recently started to burn BCH by sending a mining fee to a black hole address with each block mined." Twelve percent of the transaction fees earned by the mining pool are burned, "said the company in a statement ." This is voluntary and we want to explain why this burning could be good for BCH as a whole. "
For those unfamiliar, funds sent to a "black hole address" can never be transferred further or accessed in any way. This makes the pieces useless for eternity, and so it is said that they are "burned".
But why did Antpool burn his hard-earned money in such a way?
Only from the generosity of their heart and as a gratitude to investors who have been HODLing BCH – or at least they say.
While active users spend BCH is very important for the ecosystem, having investors who hold BCH is also a fundamental requirement for maintaining a strong economy. Without these holders, BCH's exchange value loses significant support. We believe that they too should benefit from BCH's growth through their continued involvement in the Bitcoin Cash ecosystem. Transaction fees earned by minors are an important indicator of BCH ecosystem growth, and if some of the costs are burned, it is actually the miners who share their income with the entire BCH network. .
Outside the BCH community, efforts are seen as an unfair attempt to manipulate the market.
Antpool's efforts appear to have had a positive impact on the BCH market.
The price of the BCH has risen sharply by about 50% of its market price since the announcement was made on Friday.
This is not the first time that Bitmain is accused of unfairly using his influence to temper the market.
Bitmain was involved in another controversy last month, when it became clear that its future Antminer X3 ASIC mining platform (specifically designed for Monero and Bytecoin) could be useless at the moment when it starts shipping.
Indeed, a few weeks later, Monero tweaked its Proof-of-Work protocol, thus making the machines unsuitable for XMR extraction. That said, minors should still be compatible with other CryptoNight based parts (unless they update their hash algorithms).
For what this is worth, one of the reasons the Monero community chose to modify the algorithm was that any specially designed ASIC for XMR would get a significant majority of the network's hashrate and introduce centralization network.
Antpool's attempts to manipulate the market in this way are not taken lightly. They highlight a major flaw in blockchain technology that has been a source of concern since the beginning of cryptocurrency.
While blockchain technology was designed to resist centralization and put control back in the hands of the masses, decentralized networks can still be dominated by large industrial players who control the majority hash.
Posted on April 24, 2018 – 13:37 UTC