What if governments make Bitcoin centralized?

[Slow death]

Have you ever thought about Bitcoin becoming centralized someday?

bitcoin is already centralized

1 - many rich people hold many bitcoins

2 - exchanges ask for KYC and real data when people create accounts

3 - for people to buy bitcoin they use bank accounts

4 - most people (I'm one of them) withdraw bitcoin to bank account

5 - Most people are always happy with things like Bitcoin ETF precisely because they want big investors and regulatory markets to come in and start using or trading bitcoin

about mining? Oh electricity is from the government so where is the decentralization?

[Ararbermas]

They're very late if they decide to make it centralized.. And for sure for them its a waste of time since the value of bitcoin price itself is very high, so for short its useless.  But you know if they're really interested on it wherein if they have plans to implement such decisions perhaps at the first place they already execute that thing.. But the fact that most of them were very against in crypto, reason they ignored it and want to ban it instead. Lol so don't expect a good decision from them when it comes crypto because they don't like such thing ever since before., and for that reason it's impossible to happen as well in the future..

[Beparanf]

They're very late if they decide to make it centralized.. And for sure for them its a waste of time since the value of bitcoin price itself is very high, so for short its useless.  But you know if they're really interested on it wherein if they have plans to implement such decisions perhaps at the first place they already execute that thing.. But the fact that most of them were very against in crypto, reason they ignored it and want to ban it instead. Lol so don't expect a good decision from them when it comes crypto because they don't like such thing ever since before., and for that reason it's impossible to happen as well in the future..

Once there is a country who can prove its beneficial in their government, one or two government will sure to start to follow but since making Bitcoin centralized is against on its purposed that’s why some country did not tend to focus on it as they see more ways that it will not be helpful in their government or will not make money for them like China is  focusing on implementing their own crypto and banning cryptos that will make their people out of paying taxes to them.

[kro55]

Have you ever thought about Bitcoin becoming centralized someday?

bitcoin is already centralized

1 - many rich people hold many bitcoins

2 - exchanges ask for KYC and real data when people create accounts

3 - for people to buy bitcoin they use bank accounts

4 - most people (I'm one of them) withdraw bitcoin to bank account

5 - Most people are always happy with things like Bitcoin ETF precisely because they want big investors and regulatory markets to come in and start using or trading bitcoin

about mining? Oh electricity is from the government so where is the decentralization?

However, it must be decentralized, as long as you use an exchange or use some centralized medium, your funds are completely decentralized in the Bitcoin blockchain. No one has the power or ability to seize or freeze your wallet's funds unless you disclose your private key. "Decentralized" and "Anonymity" are different things, Yes nowadays it is less anonymous but still fully decentralized.

[Quidat]

They're very late if they decide to make it centralized.. And for sure for them its a waste of time since the value of bitcoin price itself is very high, so for short its useless.  But you know if they're really interested on it wherein if they have plans to implement such decisions perhaps at the first place they already execute that thing.. But the fact that most of them were very against in crypto, reason they ignored it and want to ban it instead. Lol so don't expect a good decision from them when it comes crypto because they don't like such thing ever since before., and for that reason it's impossible to happen as well in the future..

Once there is a country who can prove its beneficial in their government, one or two government will sure to start to follow but since making Bitcoin centralized is against on its purposed that’s why some country did not tend to focus on it as they see more ways that it will not be helpful in their government or will not make money for them like China is  focusing on implementing their own crypto and banning cryptos that will make their people out of paying taxes to them.

Each country does have particular takings about Bitcoin and most of them do falls on the negative side which they are trying to centralized or regulate things around which do involves bitcoin which it isnt surprising that they would come up into that idea because talking on centralizing it directly or technically couldnt really be possible and for sure they had able to try it out since from the beginning
when bitcoin is starting out to make out some popularity and making such bigger adoption as years passed which it wont really be that surprising that they would really be
testing out different ways on just to follow on whats up into their mind.

[Kelvinid]

Can be possible if they will buy the entire market and put everything in their hands. We sometimes think that prices are already manipulated by whales, by influential people, and yes, we could admit such a thing. But it just stops there, that is the only thing they could do, and still, they can't control the entire market knowing that they don't hold this. And I know that no country has the courage to take it all in order to have this control and risk money with this volatile market. It never makes sense anymore and they could not benefit from this then rather have their own currency instead.

[South Park]

This will never happen to Bitcoin and governments won't waste time mining and taking control over Bitcoin that is 90% mined already,
they can just create their own centralized digital junk currencies with infinite supply and with shutdown button for anyone who is not obedient.
Look what is happening in the world now and you will see that is the way they are going.

This, governments do not play following the rules of someone else, they are the ones that get to make the rules so I doubt they will try to subvert bitcoin in that way, they will just create their own currencies that look like bitcoin but which run on the opposite ideals and promote them heavily on the media, people then will just adopt them thinking those currencies are a better form of fiat and will think they are better than bitcoin as they have the backing of the governments, only a few will realize the trick and will get the real thing, which is exactly what is happening right now.

[icopress]

[...]

To begin with, the Chinese nation has an exceptionally subtle mentality, it is a kind of closed community that has developed for several thousand years in parallel with the rest of the world. Yes, they also have corrupt politicians and mercantile people, but the Chinese first of all take care of each other.

Therefore, you can forget about the long-term prospects, because what their government has done will ultimately benefit only the Chinese. I deviated a little from the topic, but it was just about strategic interests ... If China really saw an enemy in Bitcoin, we would see a lot more attacks no matter how many years ago there cyber department learned about the existence of Bitcoin. 

[diahsw]

if bitcoin becomes the world's currency then that's pretty crazy, which is a good idea, but we have to realize to be like that and what we hope to be requires a very hard and rigorous process. For that we can hope and declare something crazy for the future, but we should not forget the process..! I think there's some hope for bitcoin to be centralized, but it's impossible in my country, because they still think bitcoin is the enemy of state banks, so it's very difficult.

[cabron]

It wouldn't so far fetch if all governments ban mining for they only make it for them, they are the only ones allowed to mine. So they would have to ban it first and then pass a law that only the government can have a mining farm. This is close to being centralized.

Today, they start the news with an energy crisis in which they would have to monitor the energy usage of all house hold. But it could be in reality they'd be monitoring if anyone is mining. Just a conspiracy theory. 

[minersday]

First and foremost, people need to understand what the word centralization is. Knowing and understanding what centralization is, will help people from believing or having an assumption that the government has any chance of making bitcoin centralized. Bitcoin will forever remain a decentralized asset and digital currency.  It's quite unfortunate that people still have doubts and don't understand what decentralization and blockchain technology is all about.

[dothebeats]

Doubt this will ever happen. There's nothing to be had in mining a coin in which its supply is almost exhausted. Plus, suppose they were successful in overpowering the network and taking control of the chain. Its value will plummet almost immediately rendering their efforts useless, or the network will just fork off and the people will recognize which is the chain that is controlled by the government and which one is not.

IMO, the government is better off creating their own coin rather than meddling with bitcoin, or any other established coin for that matter.

[pooya87]

If they manage to control more than 51% of Bitcoin's hashrate, the cryptocurrency will effectively become centralized.

You either don't know what centralized means or don't know what having 51% of the hashrate means.
Owning hashrate won't centralized bitcoin, they won't even be able to censor bitcoin transactions because the remaining 49% will still mine your transactions.
Besides you are forgetting that bitcoin is a global currency not only operating in one country. If one government started building up its hashrate, others will do the same too so we could essentially end up with multiple governments each owning a tiny portion of the hashrate like 10%.

That, and the fact that they already control centralized exchanges is a very alarming situation for the future of Bitcoin.

Same arguments about hashrate but additionally centralized exchanges have nothing to do with bitcoin!

[rizqoAD]

Now, many countries around the world are starting to adopt Bitcoin as a legal tender, but many are also against it. A further concern for Bitcoin users is that Bitcoin becomes more controlled if a country can hold the 51% of Bitcoin currently circulating in the market, but achieving that in my opinion is difficult because Bitcoin mining revenue is always halved every 4 years. I think Bitcoin will remain decentralized even though many parties want to control Bitcoin but it will be in vain. Whereas Bitcoin cannot replace fiat because fiat is protected by the regulations of each country so it is impossible for fiat to be replaced by Bitcoin.

[OrangeII]

I also think that bitcoin and government will not unite. however, there are many things that bitcoin has in its possession but challenges the government.
however, if the government intends to have more bitcoins so that bitcoins become centralized, I think it's still quite difficult. given that the price of bitcoin is unstable. if the government owns 51% of bitcoin, but the rest is still very much free to trade. it will only make bitcoin like being held by the government, and the government also has the same impact as us. imagine, if the bitcoin adoption rate were to decrease because of this, it could have an impact on the price going down. and if the government has a higher percentage, then the losses received by the government can be very large. Well, the only way around this is for the government to allow bitcoin as a payment alternative, and adopt bitcoin privately.

[zaesvlas]

I think that very little will change dramatically. Perhaps they will have to pay taxes, but they have been wanting to do this for a long time.

[buwaytress]

[...]

To begin with, the Chinese nation has an exceptionally subtle mentality, it is a kind of closed community that has developed for several thousand years in parallel with the rest of the world. Yes, they also have corrupt politicians and mercantile people, but the Chinese first of all take care of each other.

Therefore, you can forget about the long-term prospects, because what their government has done will ultimately benefit only the Chinese. I deviated a little from the topic, but it was just about strategic interests ... If China really saw an enemy in Bitcoin, we would see a lot more attacks no matter how many years ago there cyber department learned about the existence of Bitcoin. 

Speaking as a southeast Asian for whom China and the Chinese are a part of out lives no matter how we want the situation to be, I agree. I always feel that the stuff I read about what the world thinks of China or how it will move/progress is a little too much like what China would like them to believe.

China has never, not in a thousand years, preferred to be obvious. Soft power, subtle advances, economic strengthening elsewhere. This is how they flex their muscle and influence.

So if they did see Bitcoin as an enemy, it wouldn't react by attacking, but by learning, infiltrating, copying and subverting.

[kryptqnick]

Have you ever thought about Bitcoin becoming centralized someday? The ever-growing mainstream adoption of Bitcoin worldwide will only lead us closer to such scenario. To our surprise, El Salvador became the first country to adopt Bitcoin as legal tender. The more popular the cryptocurrency becomes, the more countries will be tempted to follow El Salvador's footsteps. Imagine governments making their own mining facilities, or even buying pre-established mining companies in order to gain a piece of the pie. If they manage to control more than 51% of Bitcoin's hashrate, the cryptocurrency will effectively become centralized. That, and the fact that they already control centralized exchanges is a very alarming situation for the future of Bitcoin.

Of course, the only way governments worldwide will be able to control 51% of Bitcoin's hashrate is if they unanimously agree on using Bitcoin is a "One World Currency". This may all sound crazy, but we cannot ignore it from happening in the future.

What are your thoughts? Will Bitcoin be able to remain decentralized for the foreseeable future? Or not? What do you think will happen if governments fully embrace Bitcoin as the replacement of Fiat? Your input will be greatly appreciated. Thanks.

I don't think this is going to happen, and that Bitcoin will get more centralized than it already is. If one country makes a big move on Bitcoin, attempting to take control over it, others will follow. Also, this will increase the demand and thus the price will rise, making taking every new bit of control more difficult, if it makes sense. Mining is in the hands of big companies, and I don't think they'll get sold to governments. Moreover, I don't see any government that would be willing to attempt taking control over Bitcoin like that and be resourceful enough to do it. So even if fiat started being replaced by Bitcoin (and that is not happening now), Bitcoin would still remain decentralized.

[meser#]

I believe at the end cryptocurrency will dominate the governments' power. Since civilization starts we made the wrong choices about financial control mechanism and I believe with the nakamoto we found the correct path. Thanks to nakamoto, he/she/they gave us the real freedom. This freedom which nakamoto gave is like double side sword. If you want to control it you will damage yourself. Instead of try to controlling; if we use it how much we need it, we will be totally free

[Kakmakr]

This is the scenario that we have been talking about for years.... and I think the sentiments and thoughts about that was that if this might happen, then people will sell their coins and move over to another Alt coin... or develop a new coin that will suit the need of the people moving to the new coin. 

These governments will have a very stormy relationship with the tax payers, if they have to continuously buy more and more hash rate to "dominate" the mining power of all these coins.