Can China takeover Bitcoin network?

[very_452001]

Most btc mining is done in China because electricity is cheap there and all mining hardware originates from there also right?

China controls over 50% of the btc hashrate meaning they can do a 51% attack on the bitcoin network or control which btc transactions are valid according to their liking correct?

Has the chinese government or chinese central bank added bitcoins to their treasury reserves apart from the tons of gold they have been buying recently?

If the chinese govenment/central bank has bitcoins in its treasury then there is no incentive for them to raid and take control of the mining pools in china otherwise they be shooting themselves in the foot right because they be crashing the price value of their btc treasury reserves correct?

Do you think electricity will get more expensive in China and by when? Higher electricity costs should encourage mining out of China to other countries so the mining becomes more decentralized.

Finally if the Chinese government/central bank dont have bitcoins in their treasuries and release their digital chinese currency CBDC then from there what guarantees can be made to long term btc investors that the chinese regime wont raid btc mining pools in China or torturing/threatening mining pool owners into handing over the hashrate control to them or force mining pool owners to get together together into 1 big mining pool company owned by the chinese authorities?

[Oshosondy]

How can China take over bitcoin network? It is not just possible in any way. China miners dominate on bitcoin mining, but not in a way they will take over the network, the domination is reducing drastically as their government is becoming hostile to bitcoin mining a little. In 2019, China mine 75% of bitcoin, in 2020 China mine 65% of bitcoin, can you see how the mining by miners in China are reducing drastically. And even with this, how can they control bitcoin network, it is not possible while bitcoin they mine are mostly sold out of China.

[Upgrade00]

China controls over 50% of the btc hashrate meaning they can do a 51% attack on the bitcoin network or control which btc transactions are valid according to their liking correct?

I believe a bulk of the mining hashrate is as a result of mining pools; miners from all over the world concentrate their computing power to a single server to increase the chances of them getting the next block collectively. This does not mean the hashrate is controlled by China, miners can easily switch to pools from other nations.

Finally if the Chinese government/central bank dont have bitcoins in their treasuries and release their digital chinese currency CBDC then from there what guarantees can be made to long term btc investors that the chinese regime wont raid btc mining pools in China or torturing/threatening mining pool owners into handing over the hashrate control to them or force mining pool owners to get together together into 1 big mining pool company owned by the chinese authorities?

As I said, the pools are not controlled so miners can as easily switch and reduce the hashrate to those pools. China has been restrictive to bitcoin adoption for a couple of years now, it's unlikely they will get to manipulate the network as consensus rule can be used to render certain chains invalid.

[Xavofat]

More important than the fact that the majority of mining takes place in China is the fact that the majority of ASIC devices are manufactured by one company: BITMAIN, which is a Chinese company.

The restrictions on BTC in China are not necessarily because China doesn't see any benefit in BTC business, but because the government wants to suppress any attempt to access the free Internet.  If a monopoly like BITMAIN is operating in China they will be more interested in controlling as much of the company's activities as possible rather than restricting BTC as a whole.

[very_452001]

How can China take over bitcoin network? It is not just possible in any way. China miners dominate on bitcoin mining, but not in a way they will take over the network, the domination is reducing drastically as their government is becoming hostile to bitcoin mining a little. In 2019, China mine 75% of bitcoin, in 2020 China mine 65% of bitcoin, can you see how the mining by miners in China are reducing drastically. And even with this, how can they control bitcoin network, it is not possible while bitcoin they mine are mostly sold out of China.

Okay if the trend continues to below 50% then that is a good sign for btc.

Selling btc out of china has nothing to do with the btc network. For example I can buy and have all the bitcoins in circulation now in the world with no effect on the btc network whatsoever. Miners do.

China controls over 50% of the btc hashrate meaning they can do a 51% attack on the bitcoin network or control which btc transactions are valid according to their liking correct?

I believe a bulk of the mining hashrate is as a result of mining pools; miners from all over the world concentrate their computing power to a single server to increase the chances of them getting the next block collectively. This does not mean the hashrate is controlled by China, miners can easily switch to pools from other nations.

Finally if the Chinese government/central bank dont have bitcoins in their treasuries and release their digital chinese currency CBDC then from there what guarantees can be made to long term btc investors that the chinese regime wont raid btc mining pools in China or torturing/threatening mining pool owners into handing over the hashrate control to them or force mining pool owners to get together together into 1 big mining pool company owned by the chinese authorities?

As I said, the pools are not controlled so miners can as easily switch and reduce the hashrate to those pools. China has been restrictive to bitcoin adoption for a couple of years now, it's unlikely they will get to manipulate the network as consensus rule can be used to render certain chains invalid.

Okay so you saying miners can simply change their pool to another country by simply changing the settings in the mining software/interface and that will cause china to lose some hashrate?

Do the miners have to do this before a potential takeover by the chinese state or can it be done afterwards or too late by then?

More important than the fact that the majority of mining takes place in China is the fact that the majority of ASIC devices are manufactured by one company: BITMAIN, which is a Chinese company.

The restrictions on BTC in China are not necessarily because China doesn't see any benefit in BTC business, buy because the government wants to suppress any attempt to access the free Internet.  If a monopoly like BITMAIN is operating in China they will be more interested in controlling as much of the company's activities as possible rather than restricting BTC as a whole.

Dont the chinese state see any taxable benefits in the btc business?

China can pass any law without the chinese people approval. They cant ban bitcoin but they can bitcoin mining in China if they want and if they do that how secure will the btc network be with half of its hashrate wiped off overnight? Can the btc network auto adjust quickly to any quick change in mining circumstances before any attacks to it?

Whats bitcoin got to do with free internet? Bitcoin is a currency not a website where the chinese state can restrict access to sites like facebook, youtube etc.

[moderator's note: consecutive posts merged]

[Dutchyyy]

In theory, investing a lot in miners and threatening the rest of the China miners, they can.

But it's pointless. If China takes control over the Bitcoin blockchain, they will cross the Rubicon, the price will plunge, and people will leave Bitcoin and move to another crypto.

[DapanasFruit]

I used to worry or be concern with the fact that majority of Bitcoin mining is coming from players in China and most of the mining equipment are made in China. However, I realized that in case China will decide to be stupid and make mining in their country controlled and run by the government they are just wasting their time because most probably miners from other sides of the world will just be taking over the business. In fact, this can be the big reason why China did not eventually ban Bitcoin mining because doing so is just shooting their own foot. Bitcoin mining is brining in important foreign currency to the Chinese economy and stopping it now is not going to be advantageous...however we can not predict what can happen in the coming years though. For now, there is nothing to be alarmed with.

[Wexnident]

Dont the chinese state see any taxable benefits in the btc business?

China can pass any law without the chinese people approval. They cant ban bitcoin but they can bitcoin mining in China if they want and if they do that how secure will the btc network be with half of its hashrate wiped off overnight? Can the btc network auto adjust quickly to any quick change in mining circumstances before any attacks to it?

Whats bitcoin got to do with free internet? Bitcoin is a currency not a website where the chinese state can restrict access to sites like facebook, youtube etc.

Well, that would just end up being met with disapproval. The very notion of Bitcoin was a disconnection from the centralized government, so the very moment China tries to profit off of mining with that, well, people would just straight up leave. Plus, it isn't like the network can be controlled by the government, nor can the influx of mining machines, so they really have no solid way to trace anyone who is mining. It's close to impossible just like how the very notion of China controlling the entire network is impossible since the former requires that they actually do the latter.

[Upgrade00]

Okay so you saying miners can simply change their pool to another country by simply changing the settings in the mining software/interface and that will cause china to lose some hashrate?

Miners  can simply disconnect from a certain pool server and either connect to another or mine solo. This would reduce the potential hashrate that a pool can provide

Do the miners have to do this before a potential takeover by the chinese state or can it be done afterwards or too late by then?

All the mining hardware which generates the hashrate is decentralized, so the miners can always switch. There is no situation where they would be stuck in a particular pool.

[YOSHIE]

Has the chinese government or chinese central bank added bitcoins to their treasury reserves apart from the tons of gold they have been buying recently?

The story is different from Bitcoin and Gold.
Gold does not have an internet network, it can be found in the real market.
Bitcoin can only be obtained on crypto exchanges and the like.

Although the Chinese have expertise in the world of the internet, technology, can create artificial suns etc, of course they cannot take over the Bitcoin network, Bitcoin is not only traded in China, all countries use Bitcoin.

If they buy Bitcoin in large quantities maybe it can, but they don't do it, bitcoin price is difficult to predict, their miscalculations can lose big, different from gold in the amount, price, and supply does not stop every day, in and out, new and old.

Bitcoin is not like that, the Bitcoin network cannot be controlled by China and any country, even though they are quite super in technology, Bitcoin is like a ghost, it can be seen and cannot be touched, if you can control a ghost you can control Bitcoin, that's for example.

[pooya87]

Most btc mining is done in China

No it is not

China controls over 50% of the btc hashrate

You don't know that.
You are also confusing mining pool with miners. A mining pool is just a group of servers that actual miners with the actual hardware connect to. The pool also has no control over the hashrate, the miners can easily switch to another pool if the one they are connected to turns malicious.
You also have no way of knowing where these miners come from. They could be from anywhere on the planet.

meaning they can do a 51% attack on the bitcoin network or control which btc transactions are valid according to their liking correct?

You can't decide "which transaction is valid" with 51% attack. You can only try and reverse a block that was mined by someone else.

[Swordsoffreedom]

You know, More than half of the world's Bitcoin mining potency is operated by China. Their computing power to mine Bitcoin is near around 65%. It's true that we can't ignore this, If somebody or someone has control over more than 50% of the total mining power, they can disrupt the operation of the plenary mining system, and they can do operate 51% attack.

But the good thing is, Even though they can do 51% attack. for this, they have to bear a lot of expenses and have to do a lot of effort and as output, they will get nothing but dust.
If 51% attacker uses their best effort they can't steal others money, the max thing they can do just disrupt the system and double-spend their holding BTC.

It makes no economical sense, I don't think the china Government will do such kind of nasty thing and harm their economical background by themself.

[Xavofat]

More important than the fact that the majority of mining takes place in China is the fact that the majority of ASIC devices are manufactured by one company: BITMAIN, which is a Chinese company.

The restrictions on BTC in China are not necessarily because China doesn't see any benefit in BTC business, buy because the government wants to suppress any attempt to access the free Internet.  If a monopoly like BITMAIN is operating in China they will be more interested in controlling as much of the company's activities as possible rather than restricting BTC as a whole.

Dont the chinese state see any taxable benefits in the btc business?

Yes, that's presumably why they haven't banned BITMAIN and some major Bitcoin related companies started in China (like the Huobi exchange).  They just ban the most egregious of speculative crypto use (including ICOs) and then allow people to keep using it in contexts that they are sure are legal.

how secure will the btc network be with half of its hashrate wiped off overnight? Can the btc network auto adjust quickly to any quick change in mining circumstances before any attacks to it?

Yes, every 2016 blocks the network adjusts its difficulty to keep the average rate of blocks being mined at approximately one every ten minutes.  This is usually about two weeks, but if the hashrate was halved it would take twice as long per block until the next difficulty adjustment.  The reward for each block, however, would increase because higher transaction fees would be required to include a transaction in the now less frequent blocks. 

One significant problem is that most mining pools are based in China.  The only mining pool not based in China with a significant percentage of the hashrate (about 10%) directed to it is Slush Pool, from the Czech Republic.

If Bitcoin pools and mining and everything was banned in China (assuming they know where all the people running them are), the remainder of the world's miners would redirect to smaller pools, removing the Chinese monopoly on mining and ultimately making the network more secure by getting rid of the risk of small groups in China reaching the 51% attack threshold (which BITMAIN approached in 2018).

Whats bitcoin got to do with free internet? Bitcoin is a currency not a website where the chinese state can restrict access to sites like facebook, youtube etc.

Bitcoin is intertwined with the free Internet.  Its users and HODLERS often have libertarian ideals and a fairly small amount (which the Chinese government could easily focus on) use it for crime.  Even though Bitcoin transactions cannot be directly prevented, China could create a culture of fear around using exchanges and accessing Bitcoin related websites.

[very_452001]

In the west that is USA and UK, the governments there are paranoid and banning Huawei from installing their communication equipment there because of a conspiracy theory they have of Huawei snooping/spying on UK and USA intel via hidden backdoor programs on Huawei's devices.

I most likely agree China wont shoot themselves in the foot by doing anything dodgy with bitcoin as that will slow them in this tech race to no. 1 tech superpower in the world. I see China being self-sustainable without relying on income from the west and for this to happen they cant shoot themselves in the foot I agree.

Most likely China will land the 1st man on planet Mars by 2030 and declare no.1 tech superpower in the world.

Yeah its a tech race and the the country with the best tech will be no.1 in the world and Bitcoin contributes towards that race.

[LittleBitFunny]

They can if they want, most of the mining power is generated by China, more than 60% of mining hash rate directly or indirectly are generated by them,
there is no other country that has close to their hashing power.
And the Chinese government has the character to take any decision without taking their people's opinion.
If Govt wants to centralized all of their mining operators under a single server then they can do that.
and if they do that, they can take over the majority of power and blocked the other miners, by doing this they can play a 51% attack to alter the broadcasted transactions.

[very_452001]

Okay I'm getting the sense that the readers of this thread are confused as there's replies here stating that China cant take over & there's also replies stating that China can take over the network 

So is this like a 50/50 debate that it is possible or not?

When it comes to computing/mathematics/logic there should be clear answer on issues like these unlike science where there's lots of theories and debates in that subject thus no clear answer in most of science.

So as of now Can China take over the Bitcoin Network as long China has over 51% of the hashrate correct? If so what reason will they have to do so?:

- If China central bank releases their programmable digital Yuan CBDC currency, will they see bitcoin as a threat to their new digital currency or will they let bitcoin continue and not interfere with it but program their Yuan CBDC by putting a 'stop buy bitcoin' algorithm in there to stop Chinese people buying Bitcoin with it?

[Pierre 2]

Well honestly speaking after reading your own comment I believe its possible in terms of mathematics, but that doesn't mean it is going to happen. I think there many other non-Chinese companies doing business with Bitcoin know that would hurt their business. They would spend a lot for it not to happen ever.
Answer for your second question, I think China may release somekind of national cryptocurrency (they are somekinda open to that kind of moves) but I don't think it will have affect on Bitcoin. I don't think they have plans to block people from trading Bitcoin as I am sure they are making great tax income over it.

[cr1776]

I think some of the confusion here is what precisely do you mean by "Can China takeover Bitcoin network?"

Does that mean some or all of the following or something else:
1. Can they 51% attack the network?   This depends on where the mining hardware is located and if miners would switch pools.  Most would.
2. Can they change the bitcoin protocol and force changes on the network?   They could fork it but it is doubtful nodes would switch to a negative fork.
3. Can they shut down the ASIC manufacturers so that there are no more miners being manufactured there?  (There are always places like TSMC which is outside China).  Of course they could.
4. Can they shut down mining pools and any mining hardware inside China?  Sure.
5. Can they put backdoors in the ASICs to remotely shutdown miners if they wanted?  Yes.
6. Can they block changes to the bitcoin protocol?  They might be able to force miners to not signal readiness, but as lightning showed, the nodes control the network, miners don't.
7. Could they block all transactions?  No.
8. Something else?  Perhaps enumerating would help to get more useful answers.

If China tried something nefarious, then it would be a reasonably easy change to the code to prevent the fork from impacting bitcoin itself.  The challenge would be to get nodes to switch software but in some type of catastrophic event most people running nodes would have incentive to follow the non-diabolical fork and just leave China with a useless fork.  One method could be by changing the hash function which would destroy the value of miners in the diabolical-fork.

So you'll get different answers depending on exactly what you meant and exactly what other people though you were asking?

[very_452001]

In Elon Musk recent tweet he tweeted that Bitcoin is not decentralized as he pointed out bitcoin losing 35% hash rate in that china power cut.

What everybody's take on this?

[diahsw]

If you take the bitcoin network, I think everyone can, especially in these countries with very developed technology, they will do what they want to dominate the world of bitcoin. But what we have to remember, is not only China that can, countries like Russia can too, even I would choose Russia which will take the bitcoin network instead of China.