Bitcoin (BTC) mining pools with 75% of hashrate back open standard for block construction

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Bitcoin mining recently experienced a significant decentralization move as seven of the largest pools quietly agreed to support the same open standard. Foundry, AntPool, F2Pool, SpiderPool, MARA Pool, Block Inc, and DMND have all joined the Stratum V2 working group, as announced last week.

Stratum V2 is an open-source protocol that governs how mining pools communicate with individual miners within those pools. One of the most notable changes it introduces is allowing individual miners to construct their own block templates. This means that miners have the autonomy to choose which transactions are included in each new block, rather than leaving that decision to the pool operators.

With Foundry alone controlling 34.2% of the global bitcoin hashrate, AntPool at 14.2%, F2Pool at 11.3%, and SpiderPool at 10.5%, along with MARA Pool contributing 4.7%, these seven pools backing the Stratum V2 standard now represent close to 75% of all bitcoin hashrate.

Under the current Stratum V1 standard, pool operators have the authority to select transactions for new blocks, leading to concerns about centralization within the mining ecosystem. Stratum V2 doesn’t alter hashrate concentration but does shift the decision-making power regarding block composition to individual miners, addressing a key concern within the Bitcoin community.

The Stratum V2 protocol was established in 2022 by Braiins and Spiral but had limited adoption until now. The recent inclusion of Foundry and AntPool has expanded its reach significantly, marking the beginning of a new phase of accelerated deployment, according to the working group.

This move towards decentralization comes at a time when a significant portion of miners are operating at breakeven or incurring losses. With up to 20% of miners estimated to be unprofitable, the hashprice (revenue per unit of computing power) is hovering around breakeven levels for operators using mid-generation hardware.

Additionally, the mining difficulty is set to increase on May 15, further adding to the challenges faced by miners. Despite these obstacles, the network hashrate currently stands at 998 exahash per second, illustrating the continued robustness of the Bitcoin mining ecosystem.

With this shift towards a more decentralized approach to block construction, the Bitcoin mining landscape is evolving to address concerns about centralization and empower individual miners within the network.