Although some view bitcoin miners as the de facto trusted third party in what is supposed to be a decentralized system, the reality is these users don’t wield as much power as some would think. In the past, Coinbase CEO Brian Armstrong has argued that miner voting is Bitcoin’s built-in upgrade mechanism, but Bloq Economist Paul Sztorc took issue with this view in a recent presentation.
In Sztorc’s view, miners are reacting to users (via price speculation) instead of putting their own policies into place. He also believes the ability for users to switch to a blockchain with a different proof-of-work algorithm essentially gives them the ability to fire all of the miners if they misbehave.
“Changing the proof-of-work function is a trivial detail for programmers, a temporary inconvenience for users, and permanently devastating for miners,” said Sztorc. “They’re not in a position to make threats, which is the source of all power.”
Creating Something Useful