Is it possible to regulate the whole Bitcoin Ecosystem ?

[legiteum]

Of course it's possible.

Thanks for letting us know. Anything is possible eh.

Believe it or not, many people here on Bitcointalk repeat, on a daily basis, that "Bitcoin cannot be controlled by any government". They repeat it like religious people do in their prayers. They take this as an unquestionable fact that cannot be argued. They base their entire life philosophy on it.

But the reality is that the US government effectively holds the $1.5T market cap of Bitcoin hostage, and all they need to do is threaten people's bags and they will dance any dance they want them to dance. A Bitcoin that went against US laws would be a Bitcoin priced at $1.50 per coin, not $70k. There's no chance most people would give up billions of dollars or even their own life savings for some religious ideal.

[Z-tight]

A Bitcoin that went against US laws would be a Bitcoin priced at $1.50 per coin, not $70k.

Lol, what laws. The last i checked BTC follows the concensus rules and not the constitution of the United States.

But the reality is that the US government effectively holds the $1.5T market cap of Bitcoin hostage, and all they need to do is threaten people's bags and they will dance any dance they want them to dance.

Stop making up conspiracy theories. Even the United States government is the nation with the largest BTC holdings. Why would they threaten people's bags, on what basis and to what end. You try so hard to prove what is not true. Governments can have an influence on the price of BTC, but they cannot control the network like they do with their fiat.

[legiteum]

A Bitcoin that went against US laws would be a Bitcoin priced at $1.50 per coin, not $70k.

Lol, what laws. The last i checked BTC follows the concensus rules and not the constitution of the United States.

LOL, not if the code is changed. It's just code, not a mystical force from outer space.

And code is written by humans, not God.

And humans can be compelled by governments to do things.

Stop making up conspiracy theories. Even the United States government is the nation with the largest BTC holdings. Why would they threaten people's bags, on what basis and to what end. You try so hard to prove what is not true. Governments can have an influence on the price of BTC, but they cannot control the network like they do with their fiat.

Why would a government threaten people to get its way? Are you really asking that? 

The fact that the US government--and the US president personally--are very large holders of BTC means that have more control, not less.

If the US government dictated that the Bitcoin codebase did something, then people would have a choice between losing almost all of the value of their BTC, or complying with what the US government wanted. 99% of people would choose their bags. (The remaining 1% post here on bitcointalk ).

[riscohen4]

There's no way Bitcoin would still be decentralised if government owned a huge fraction of its mining operations. The whole point of Bitcoin is to be free from government. Government intervention eliminates that.

If a particular government, let's say US, tries to regulate Bitcoin with the help of every country in the world, it won't work. Because countries have different interests. The main thing that gives Bitcoin its kingship is because no single entity controls Bitcoin.

[legiteum]

There's no way Bitcoin would still be decentralised if government owned a huge fraction of its mining operations. The whole point of Bitcoin is to be free from government. Government intervention eliminates that.

If a particular government, let's say US, tries to regulate Bitcoin with the help of every country in the world, it won't work. Because countries have different interests. The main thing that gives Bitcoin its kingship is because no single entity controls Bitcoin.

The government doesn't need to own anything in order to effectively control Bitcoin. That's not how laws work. They just pass laws telling them to do things and they do them. Ownership is not necessary.

And the US, its citizens and the companies incorporated here make up perhaps 90% of the known Bitcoin market cap and probably about 80% of individual holders. That alone would be more than enough to control BTC's price, which is the same as controlling Bitcoin.

[Patikno]

To understand the concept of how it can be controlled, we need to understand how the Bitcoin ecosystem works.
Bitcoin Ecosystem usually works from the help of miners and node operators. By solving complex mathematical puzzles, they are discovering the block and adding it to the ledger, and node operators are verifying all the transactions that are included on the ledger by miners.

So hypothetically, if governments around the world somehow took control of all major mining operations and imposed a global ban where only governments were allowed to mine Bitcoin, would Bitcoin still remain decentralized?

I know this scenario is extremely unlikely, but in that case, could Bitcoin still truly be considered decentralized?

Let me answer this, simply. 

1. First, Bitcoin has a consensus mechanism called Proof of Work, and anyone can participate by running a node as a miner.

2. Second, there are many miners contributing their computing power, and based on the references I have found, the current Bitcoin hashrate is around 1 ZetaHash per second (approximately 1 billion Tera Hashes per second, or approximately 1 quadrillion Mega Hashes per second).
  - Even if you had the latest ASIC miners (100,000 devices) with a computing power of around 1 Peta Hash per second (per device), they would be incapable of attacking the Bitcoin network.

3. Third, the difficulty level, or "Difficulty/Diff", of Bitcoin Proof of Work system also helps protect Bitcoin from 51% attacks.

The bottom line is, that Bitcoin is incredibly extremely difficult to control. Hypothetically or theoretically, the scenario the OP mentioned is plausible, but in practice, is it easy to realize? My answer is "No", they can't control everyone in the world. I hope some of my explanations are helpful. Cmiiw.


Some of my references :
  1. bitbo.io - Hashrate Converter
  2. coinwarz.com - Bitcoin Hashrate
  3. whattomine.com - ASIC ranking for Bitcoin
  4. bitbo.io - What does Bitcoin Mining Difficulty Mean?

By the way, I think it is important for you to read this :

There are ways to profit that don't reveal their control.

It will be clearly visible for anyone, who will type "getchaintips" in their node.

to mine 100% of future blocks

Then why it is called "51% attack", and not "100% attack"? Note that if the group of honest miners still have remaining 49%, then they can still mine, on average, every second block. If it will be reorged, then people will notice that. First, because of chaintips. Second, because all miners in a given pool will suddenly see, that a pool is getting all of their blocks reorged.

So, doing a chain reorganization is not a silent thing. It is visible in logs. It is measured. It will be noticed. And people will take action (for example by leaving the 51% pool, because their reputation will be destroyed).

Even less serious reorganizations were noted, for example: https://bitcointalk.org/index.php?topic=5447129

So, why do you think, that 51% attack will remain unnoticed, if even sigops limit violations were caught? And they are much more silent, because a block, which violates sigops limit, is simply invalid, so you have to receive it directly from a failing node.

and, with half the hashpower, earn 100% of the rewards

This is not the case. If you have 51% mining power, then you can earn 51% rewards on average. Earning 100% rewards require 100% hashpower (or reorging all blocks, mined by everyone else, but then, it is very far from being "silent").

Also, there is one important thing: jumping from 51% to 60%, 70%, 80%, and so on, doesn't make much sense. Because then, you are basically raising your own difficulty, for no reason. And then, you can paradoxically get more coins, by going from 90% to 60%, because then, the difficulty can drop, so you will pay less for electricity.

[legiteum]

The bottom line is, that Bitcoin is incredibly extremely difficult to control. Hypothetically or theoretically, the scenario the OP mentioned is plausible, but in practice, is it easy to realize? My answer is "No", they can't control everyone in the world. I hope some of my explanations are helpful. Cmiiw.

You don't need to control the Bitcoin hashrate in order to control Bitcoin. If the US passed a law that all Bitcoin miners had to do xyz, then they would either follow the law or they would go out of business, so they would certainly try to follow law first.

And Bitcoin's definition is a lot more than just mining...

[Z-tight]

You don't need to control the Bitcoin hashrate in order to control Bitcoin. If the US passed a law that all Bitcoin miners had to do xyz, then they would either follow the law or they would go out of business, so they would certainly try to follow law first.

And Bitcoin's definition is a lot more than just mining...

You are still on with your conspiracies theories that are very unrealistic. I gave you one of mine a few posts back, so what if the U.S. also passed that law huh? Sell all their gold and buy BTC. How about what if the U.S. spent billions of taxpayers money to perform a 51% attack, how about that one? All unrealistic and wouldn't happen, just like what you are spewing.

Maybe you'd have to get into congress yourself and propose such a bill.

[FP91G]

The bottom line is, that Bitcoin is incredibly extremely difficult to control. Hypothetically or theoretically, the scenario the OP mentioned is plausible, but in practice, is it easy to realize? My answer is "No", they can't control everyone in the world. I hope some of my explanations are helpful. Cmiiw.

You don't need to control the Bitcoin hashrate in order to control Bitcoin. If the US passed a law that all Bitcoin miners had to do xyz, then they would either follow the law or they would go out of business, so they would certainly try to follow law first.

And Bitcoin's definition is a lot more than just mining...

The largest companies buying Bitcoin are in the US, and you're saying the US government will force these companies to shoot themselves in the foot?
They used to write the same thing about the Chinese government, and now they're writing about the US government.

[Synchronice]

To understand the concept of how it can be controlled, we need to understand how the Bitcoin ecosystem works.
Bitcoin Ecosystem usually works from the help of miners and node operators. By solving complex mathematical puzzles, they are discovering the block and adding it to the ledger, and node operators are verifying all the transactions that are included on the ledger by miners.

So hypothetically, if governments around the world somehow took control of all major mining operations and imposed a global ban where only governments were allowed to mine Bitcoin, would Bitcoin still remain decentralized?

I know this scenario is extremely unlikely, but in that case, could Bitcoin still truly be considered decentralized?

Bitcoin is truly decentralized. You don't know the owner of Bitcoin and will never know. Also, Bitcoin can be mined all over the world. The only way to completely regulate Bitcoin ecosystem is to completely set the control on the internet around the world but it's not possible for any single entity to completely control the internet because internet was designed to be decentralized and resilient, it's a network of networks with millions of interconnected nodes. It's also impossible to force every country to restrict Bitcoin mining, so, as you see, it's not possible to regulate the Bitcoin ecosystem.

[legiteum]

You don't need to control the Bitcoin hashrate in order to control Bitcoin. If the US passed a law that all Bitcoin miners had to do xyz, then they would either follow the law or they would go out of business, so they would certainly try to follow law first.

And Bitcoin's definition is a lot more than just mining...

You are still on with your conspiracies theories that are very unrealistic. I gave you one of mine a few posts back, so what if the U.S. also passed that law huh? Sell all their gold and buy BTC. How about what if the U.S. spent billions of taxpayers money to perform a 51% attack, how about that one? All unrealistic and wouldn't happen, just like what you are spewing.

Maybe you'd have to get into congress yourself and propose such a bill.

The OP asked the question, "Is it possible to regulate the whole Bitcoin Ecosystem ?". The answer is yes.

And no, it's not necessary for the US government to perform a 51% attack when they can simply pass a law compelling miners (and the rest of the ecosystem) to do whatever they want them to do. It's the same reason the IRS doesn't break into your home and steal your silverware in order to collect its taxes. It's a lot simpler than that when you are the government.

Also, you don't seem to understand what the phrase, "conspiracy theory" means .

You don't need to control the Bitcoin hashrate in order to control Bitcoin. If the US passed a law that all Bitcoin miners had to do xyz, then they would either follow the law or they would go out of business, so they would certainly try to follow law first.

And Bitcoin's definition is a lot more than just mining...

The largest companies buying Bitcoin are in the US, and you're saying the US government will force these companies to shoot themselves in the foot?

They used to write the same thing about the Chinese government, and now they're writing about the US government.

No, I am saying the exact opposite of that: that the major holders and brokers of Bitcoin will do whatever is good for them and they can effectively do whatever they want with Bitcoin. What average non-whale holder of Bitcoin wants--or what the religious Bitcoin maxis want--doesn't matter.

For instance, in this thread I asked whether making the Bitcoin architecture more centralized would make it go up in price. You can argue if it would or not (there are pros and cons), but if Michael Saylor or Donald Trump decided it would, then they could easily make it happen by coercing or convincing a small group of people and/or the US government.

(That I keep going back and forth between major BTC holders and brokers and the US government is sorta the point: crypto is now the #1 largest campaign donor in US elections, so all of these people make use of government force to get what they want just as much as their own market force, which is also massive).

In short, this idea that Bitcoin is controlled by "nobody", and "cannot be controlled by the government" is just... nuts...

You can't start another project and call it "Bitcoin" and use the bitcoin symbol in its marketing. Why? It's illegal. Who makes it illegal? Congress. Who could change the law to make the current codebase illegal and the one they wanted legal instead? Congress.

[Orange89]

To understand the concept of how it can be controlled, we need to understand how the Bitcoin ecosystem works.
Bitcoin Ecosystem usually works from the help of miners and node operators. By solving complex mathematical puzzles, they are discovering the block and adding it to the ledger, and node operators are verifying all the transactions that are included on the ledger by miners.
So hypothetically, if governments around the world somehow took control of all major mining operations and imposed a global ban where only governments were allowed to mine Bitcoin, would Bitcoin still remain decentralized?
I know this scenario is extremely unlikely, but in that case, could Bitcoin still truly be considered decentralized?

honestly like technically yeah governments can try to regulate the edges of the bTc like exchanges miners & on ramps but the actual protocol??I think thats way harder to control isn't

if the US passed a law and says all miners had to do XYZ sure some might do it for sure but others would just move offshore or go underground
bitcoin was literally built to resist this kind of pressures

and about the CODEBASE being made illegal ? I think  they can ban the name or the symbol but they cant un-invent the tech the code is already out there open source and yes it's running on thousands of nodes worldwide

also the idea that big holders or politicians could just Decide to centralize btc ignore how the network actually works
changes need broad consensus from devs miners & users it is messy by design

do i think Governments will try to control it ? I think I will ABSOLUTELY they already do with kyc rules & tax reporting
but fully Regulating the whole ecosystem it feels like trying to hold water in your hands lmao

BTC might bend but i dont think it WILL breaks atleast not that easy 

[legiteum]

if the US passed a law and says all miners had to do XYZ sure some might do it for sure but others would just move offshore or go underground
bitcoin was literally built to resist this kind of pressures

and about the CODEBASE being made illegal ? I think  they can ban the name or the symbol but they cant un-invent the tech the code is already out there open source and yes it's running on thousands of nodes worldwide

also the idea that big holders or politicians could just Decide to centralize btc ignore how the network actually works
changes need broad consensus from devs miners & users it is messy by design

do i think Governments will try to control it ? I think I will ABSOLUTELY they already do with kyc rules & tax reporting
but fully Regulating the whole ecosystem it feels like trying to hold water in your hands lmao

BTC might bend but i dont think it WILL breaks atleast not that easy 

There is no magic person controlling Bitcoin, only a bunch of companies and individuals and their decision which fork to trade on. Whether the new code is a "shitcoin fork" or "official Bitcoin" depends on what the majority of holders think, not some central group. (But governments can enforce the trademark "Bitcoin" any way they want). And realistically, it wouldn't be the majority of people, it would be the majority of the money. Almost all holders of Bitcoin do it to make a profit, and if they see more money on one side than the other, they will choose the side with more money. Major holders and brokers can control the price. If Donald Trump + Michael Saylor + CoinBase + Binance + 2 Major Miners + a few others want xyz, then they will switch to xyz and that will be Bitcoin regardless of what anybody else wants. And everybody would switch since your Bitcoin would be worth $70k on their network and $1.98 on the other network.

And yes, you are right, this whole conversation is a little silly since Bitcoin is already pretty much regulated. Almost all holders of Bitcoin do so through some highly regulated means like a broker, or an app or the ETFs. And the on/offramps are highly controlled.

I keep saying that Bitcoin is to its original ideals as our modern commercialized Christmas is to Jesus Christ .

[Shadiq]

Still, Bitcoin will remain decentralized. Bitcoin cannot be centralized by controlling only mining, but also by controlling the entire Bitcoin transaction. If governments create a global ban on Bitcoin by controlling Bitcoin mining and Bitcoin transactions, then perhaps the Bitcoin market will continue to decline from which it will be difficult for Bitcoin miners (governments) to recover the mining costs. Then there will be nothing for them except that control will fail.

Even if the governments of the entire world come together and ban Bitcoin mining at the same time, this is only hypothetical. The government will not be able to do such a thing, because the price of Bitcoin changes depending on the demand. So if anyone does something that is likely to reduce the demand for Bitcoin, then the price of Bitcoin will also start to decrease. If the price decreases, the government will not have much profit by controlling Bitcoin.

[YOSHIE]

Is it possible to regulate the whole Bitcoin Ecosystem ?

If I think it's impossible, we all know that Bitcoin doesn't have a single manager like Ethereum, BNB and so on, as far as I know, the network that Bitcoin uses and that currently exists is invulnerable and cannot be controlled individually. As far as I know, the nature of the Bitcoin ecosystem is centralized/core, whereas Bitcoin doesn't have any of that, it runs on its own, meaning it is decentralized.

Bitcoin can be carried out in the form of other ecosystems, such as taxes, Bitcoin service providers, legality of Bitcoin ownership and so on which are controlled by rules based on supervisory institutions or government authorities, If you want to create an ecosystem for Bitcoin alone, it seems impossible to do.

[macson]

I don't know why governments around the world want to ban individuals from Bitcoin mining, because so far they have been making profits, in the form of taxes just from crypto regulations alone --- I don't think they would go to such lengths to make it so that only they can do mining, it's basically impossible to achieve when all the world's governments can't even agree on a serious issue, let alone something that isn't really that important.

[Joy- maker]

Before that can happen the whole world government would have to be one, with the present state of the world every government is looking for an advantage over another and if a government place a ban on mining the other government will welcome Bitcoin miners because they will be having the edge.
It is extremely unlikely for ever government to take hold of all Bitcoin mining and place a ban on it at the same time when we don't operate under one government.
Yes if you want to think fictionally and have imagination it is possible to regulate the whole Bitcoin ecosystem but it is not realistic.

You have said it all, @BIT-BENDER. And government taking over the entire bitcoin ecosystem is what i don't see happing, even in the nearest future, because no single government can single handedly take over the bitcoin ecosystem. And we are in a world where all countries what to stand on their own, no country wants to unit with another. Therefore, bitcoin remains decentralized as it was designed to be, at least for now.

[legiteum]

You have said it all, @BIT-BENDER. And government taking over the entire bitcoin ecosystem is what i don't see happing, even in the nearest future, because no single government can single handedly take over the bitcoin ecosystem. And we are in a world where all countries what to stand on their own, no country wants to unit with another. Therefore, bitcoin remains decentralized as it was designed to be, at least for now.

Except that almost all of the major holders of BTC and/or the companies supporting BTC and/or the major miners and all of the ETFs are in the USA. And Michael Saylor is in the USA. And the USA has the only president who personally owns nearly a billion dollars in BTC. (And Satoshi was probably an agent working for the government of... the USA ).

But yeah, sure, the USA is "just another country" for Bitcoin. Keep telling yourself that  .

I mean, sure, the US and its citizens and companies could leave Bitcoin entirely and Bitcoin would still "exist", but 99% of its value would go away.

And for most people--not "hardcores", not "maxis", not cyberpunk religious people--Bitcoin's price is Bitcoin.

[Fivestar4everMVP]

To understand the concept of how it can be controlled, we need to understand how the Bitcoin ecosystem works.
Bitcoin Ecosystem usually works from the help of miners and node operators. By solving complex mathematical puzzles, they are discovering the block and adding it to the ledger, and node operators are verifying all the transactions that are included on the ledger by miners.

So hypothetically, if governments around the world somehow took control of all major mining operations and imposed a global ban where only governments were allowed to mine Bitcoin, would Bitcoin still remain decentralized?

I know this scenario is extremely unlikely, but in that case, could Bitcoin still truly be considered decentralized?

Well, as much as I hate to think vain or impossible things, I would say that this can be possible to the mind but realistically, it's not possible, because first, like I believe some users in their comment might have said, the world we live in today does not operate under one government, every country in the world today has their own government and territory to secure and protect, and when one government bans the public from mining bitcoin and takes full possession of mining, governments from other countries may be buy into same idea and still allow the public to mine bitcoin normally, in this case, the government that took over mining have not or did not succeed in centralising the bitcoin network one inch.

And let us even assume that every government in the world bans bitcoin mining and take possession of it, full centralization still won't work except all those government merge to become one all over the world, making one policy, one rule, one terms and having one goal and purpose, and you know this is not possible.

[uchegod-21]

I don't know why governments around the world want to ban individuals from Bitcoin mining, because so far they have been making profits, in the form of taxes just from crypto regulations alone --- I don't think they would go to such lengths to make it so that only they can do mining, it's basically impossible to achieve when all the world's governments can't even agree on a serious issue, let alone something that isn't really that important.

Governments are known to always want to be in control,  you can't say the government wouldn't be interested in taking over mining because if they had the ability to, they will form a unified force and forcefully take over mining from miners just so that they can control the network and the entire ecosystem.

Miners alone do not control the Bitcoin network, we have the node operators, developers and others who work together to keep the network decentralized. So if the government take over mining,  the control and influence will be felt greatly, but that will not automatically push bitcoin into centralization, node operators may be the government's greatest threat to achieving a full centralized system.

But, all of these is very very unlikely because the governments all over the world can never unite for this purpose.