Economist Nouriel Roubini has attacked the notion that the Bitcoin network is truly decentralized, reiterating fears that miners and nodes are actually concentrated in the hands of just a few players.
Nouriel Roubini, a prominent economist and professor at New York University’s Stern School of Business, has fired another critical tweet about the crypto system, this time stating it is, in fact, more centralized than the public realizes. He specifically mentioned Bitcoin (BTC) as being a system of inequality and pointed to Ethereum (ETH) as being led by a “dictator” in the person of Vitalik Buterin.
Roubini went as far as to compare crypto ecosystems to North Korea:
The former US Treasury senior adviser has been known for calling Bitcoin the biggest bubble in human history, predicting that its value would go down to zero.
The Bitcoin network has no voting or delegation, meaning that each mined and node choose their position based on the version and the approach to running the project. However, more than 95% of all nodes now run Bitcoin Core, with no dissent on the features and the future of the coin.
When it comes to mining pools, Antpool mines more than 18% of blocks, and four of the largest pools mine more than 60% of all blocks, creating fears of collusion.
As for Ethereum, its future direction is decided by a small group of developers, and the coin’s evolution is pre-decided.
However, all crypto coins remain decentralized in principle if not in fact, and the concentration of Bitcoin mining is just the current technological development. Additionally, Bitcoin and Ethereum are still decentralized, meaning there is no central entity to decide on the state of the ledger or define the future policy. The ecosystems are still a matter of consensus. It is indeed possible for nearly all coins and tokens to have an ecosystem concentrated in the hands of a few large players, or “whales.” However, no whale has ever taken ownership or defined the direction of Bitcoin.
Bitcoin nodes are also making a case for localization rather than centralization. More than 23% of them are located in the US, possibly because of the use of cloud services. Another 19% are located in Germany. Other countries have various concentrations of nodes, depending on their economic potential and the popularity of Bitcoin.