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Author Topic: 2012-06-05 Growing Decentralization in the Bitcoin Economy  (Read 838 times)
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June 07, 2012, 02:12:14 PM

Could moderator remove this message, please.
It is a duplicate. Sorry. My mistake.

Growing Decentralization in the Bitcoin Economy

June 5, 2012 by Vitalik Buterin

Centralization has always been an issue in the Bitcoin ecosystem. The original spirit of the currency, as envisioned by its early adopters and its founder Satoshi Nakamoto, features a distributed network of independent miners, a peer-to-peer community of users trading bitcoins for products and services with each other over the internet and an unprecedented stability and universality arising from the currency not being dependent on any one currency or government. By the middle of 2011, however, it became clear that this was not at all the case – what we got instead is an oligopoly of mining pools, a Bitcoin exchange market dominated by a seemingly immovable monopolist, and a hopelessly intertwined connection with the United States and its dollar. Many have been unhappy with such a state of affairs ever since it developed, although others argue that it is the optimal level of centralization decided on by the free market and the best exchanges and pools deserve their market shares for providing a superior quality of service. For the longest time, this state of affairs remained. Tradehill came and went, Deepbit remained as strong as ever, and MtGox’s market share was progressively increasing all throughout the latter half of 2011. More recently, however, the free market has begun to take another course.

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