Proof-of-Work Causes Blockchain to Recapitulate Geopolitical Status Quo


This is a really well-written article that highlights the influence of electricity infrastructure and price on Bitcoin’s ambitions to be politically decentralized:

This argument would be true of any proof-of-work solution, including Ethereum today.

Personally, I think Self-Sovereign Identity is needed in the new future of political decentralization. While proof-of-stake could help make power a little more evenly distributed, the only thing that can make a democratic “one-person-one-vote” type of system work is the verification of a person as a person. And that requires tapping into human networks and intelligence, not just machine networks and protocols.


This is an interesting piece. Though I think that the author is off-base claiming that bitcoin or blockchain was ever really “apolitical”.

As far as geographic centralization of nodes, I agree this is an issue, and really why I think ASIC-resistance is an important consideration in the space, though it has often been overlooked. The option to mine with consumer-grade hardware makes it much simpler to realistically decentralize mining, even if individuals join pools in order to be more profitable and share risk/reward.

At the same time, this discussion, especially the concept of the incentive layer being warped by a connection to electricity cost, is really valid. I think it is particularly interesting the assertion that post-2013 miners (in the BTC ecosystem) are destined to only be “second-class” citizens, especially given the geographic distribution of nodes, the requirement of specialized mining hardware (ASICs), and the fact that if there were to be a better distribution, new nodes would have to be added in the “global south” where there are likely to be socioeconomic barriers for individuals to enter into the system.

This is definitely an interesting look at the potential use of bitcoin as an attack vector, though I think that the proposed process is a relatively improbable set of events. Especially given the development of the Lightning Network and a lot of PoS work as well that would help mitigate these issues. Nonetheless, the aspects of off-chain political risk is an important consideration, as there are certainly aspects of political involvement (via subsidized electricity etc) that have warped aspects of the incentive layers, at least for individuals that do not have the flexibility of simply moving or setting up miners where electricity is cheap, or to run mining nodes “at a loss”.

Measuring Political Decentralization