Bitcoin Mining Concentration Triggers Rare Two-Block Chain Reorganization

Bitcoin launched on January 3, 2009, using a proof-of-work system in which miners compete to add transactions to the ledger. When mining pools aggregate computing power and produce several blocks in quick succession, the network accepts the chain with the most cumulative work and discards blocks on the competing chain. Large pools such as Foundry USA control a greater share of computing power, making the degree of mining centralization critical to network resilience.

In the latest incident, Foundry USA, the largest mining pool, mined seven consecutive blocks and triggered a rare two-block chain reorganization. Valid blocks produced by AntPool and ViaBTC were replaced by the longer chain. Reports did not disclose the exact date of the incident or the amount of any losses. There is currently no evidence that the network’s overall security was threatened, but concentrated computing power increases the likelihood of temporary competing chains.