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Auradine CEO says Bitcoin decentralisation crucial for security

Auradine CEO says Bitcoin decentralisation crucial for security

GrafaGrafa2024/10/05 07:30
By:Mahathir Bayena

Bitcoin's (CRYPTO:BTC) decentralisation is not only vital to the cryptocurrency ecosystem but also a matter of national security, according to Rajiv Khemani, CEO of mining chip manufacturer Auradine.

Khemani highlighted the risks associated with foreign hardware and firmware, warning that these technologies could be used to compromise the energy grid or launch a 51% attack on the Bitcoin network.

Khemani explained that malicious code embedded in third-party firmware could potentially disable mining operations in specific regions, leading to a significant reduction in Bitcoin’s hashrate and network difficulty.

Such a scenario could make the Bitcoin network more vulnerable to a 51% attack.

Current data from CryptoQuant shows that Bitcoin’s network difficulty stands at 88.4 trillion, down from 92 trillion in September 2024, reflecting the ever-changing nature of the network’s security.

He emphasised the need for caution when using hardware and software from foreign sources, especially given the role Bitcoin mining plays in the energy infrastructure.

"Anytime you have hardware, software, and firmware from a foreign entity connected to your energy infrastructure — which is what Bitcoin has essentially become — you have to ensure proper due diligence and risk mitigation," Khemani stated.

Another significant issue is the concentration of specialised mining hardware production, like application-specific integrated circuits (ASICs), in certain jurisdictions.

Khemani argued that if one country controls the majority of production, they could restrict access, leaving miners without the critical technology.

He suggested that policies should encourage domestic manufacturing of ASICs to reduce dependency on foreign suppliers.

Khemani also refuted concerns from U.S. Senator Elizabeth Warren about foreign miners spying on U.S. military bases, noting that Bitcoin mining hardware lacks the memory and surveillance capabilities to do so.

In 2024, concerns were raised about hashrate centralisation after reports indicated that two mining pools controlled over 50% of the network's hashrate.

However, the geographic distribution of miners complicates these concerns, as participants remain spread across various regions.

At the time of reporting, the Bitcoin price was $62,132.22.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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