Warning: U.S.-Based Mining Firm Marathon Wants To Create Different Categories of Bitcoin
Will there eventually be good and bad BTC?
American mining giant Marathon Digital has just announced that as of May 1, 2021, it will redirect all of its hash rate power to a regulatory compliant Bitcoin mining pool. Marathon Digital describes this mining pool as the first in North America that will be "fully compliant with U.S. regulations".
This announcement by Marathon Digital shows the growing willingness of industry players to clear the air with U.S. regulators. Marathon Digital's mining pool will adhere to the anti-money laundering rules defined in the United States by the Office of Foreign Asset Control (OFAC).
To do so, Marathon Digital will ensure that all transactions processed in the pool will comply with regulatory standards through the use of an exclusive technology licensed by DMG Blockchain. This technology allows filtering the transfers made on the Bitcoin network.
Marathon Digital will direct 100% of its hash rate power to its compliant Bitcoin mining pool
As of May 1st, Marathon will switch 100% of its current hash power to this new mining pool. The pool will accept hash power from other U.S.-based miners starting June 1, 2021.
By 2022, Marathon Digital expects to have deployed 103,120 miners to direct 10.37 exahashes per second, or EH/s, to the mining pool. This represents 6.4% of the total Hash Rate power currently available on the Bitcoin network.
Merrick Okamoto, Marathon's chairman and CEO, explains that despite the growing influx of institutional investors into the Bitcoin world, the lack of regulatory certainty is preventing many firms from getting involved in Bitcoin mining:
“While institutional interest in Bitcoin is accelerating, many large funds and corporations have expressed concerns over purchasing Bitcoin that may have been tainted by nefarious actors.”
Marathon Digital intends to respond to this problem with its mining pool, which guarantees compliance with the rules issued by the American authorities.
A geopolitical war for the control of the hash rate power will occur in the coming years
We can also see the beginning of a geopolitical battle for the control of the hash rate power of the Bitcoin network, as Atticus Francken - Co-Founder and Senior Fellow, Future of Digital Currency Initiative at Stanford University - explains so well:
“The geopolitical value of moving mining pools to North America cannot be understated. Bitcoin is now no different than any other strategic or rare-earth commodity.
In fact, given the number of businesses now leveraging the potential and promise of Bitcoin both for distributed ledger benefits and as a reserve and hedge against inflation points to Bitcoin being with few peers in how important it is for long-term U.S. interest.
With the work of the Future of Digital Currency Initiative at Stanford, the team here believes this infrastructure will help further decentralize Bitcoin and secure the fidelity of the network in both the short and long-term.”
Does the Marathon Digital initiative risk creating two categories of BTC in the future?
This initiative by Marathon Digital is not without its questions. The most important of these is whether Marathon will create different classes of BTC in the future.
On the one hand, we would have the classic BTC, and on the other hand, the BTC certified by American mining actors.
For many, this may seem surprising since they frequently hear that Bitcoin is used to facilitate money laundering. The general public, therefore, thinks that Bitcoin is an opaque system. In reality, Bitcoin is a pseudonymous system.
Companies, such as Chainalysis, have specialized in tracing a lot of information about all transactions made on the Bitcoin network. In fact, it is already possible to identify the entire history of most of the BTC in some detail. The BTC used for illicit transactions on the Dark Web in 2014 are well identified.
Those coming from the hacking of an exchange platform too.
Mixing services theoretically help to cover their tracks. Nevertheless, the use of these tools remains confidential. This is one of the things you need to know if you want to protect your privacy and anonymity on the Bitcoin network.
Marathon Digital, therefore, wants to differentiate between these two categories of BTC to reassure investors who want to come and profit from the booming Bitcoin sector.
Final Thoughts
Eventually, one could imagine a scenario where industry heavyweights in the United States or Europe would block the acceptance of BTC that are considered to be unsound. Only BTC that are considered to be sound by entities like Marathon Digital would then be accepted.
All this is still a guessing game. It's hard to say what impact Marathon Digital's decision will have on the Bitcoin world.
Nevertheless, this initiative could certainly be a landmark in splitting Bitcoin into two categories. On the one hand, the classic BTC, and on the other, the BTC considered clean by the American authorities. A clever way for the United States to gradually begin to take hold of the Bitcoin revolution.
Some reading:
Don’t Believe What the Fed Says — Inflation Is Coming and Bitcoin Is Your Best Hedge Against It - You need to make the best decisions to protect the fruits of your labor.
IMF Fears That the Global Debt Boom Could Lead to a Stock Market Crash and Cripple the Economy - Central banks need to start turning off the tap of easy money.
100% of People Should Buy Then HODL Bitcoin - That’s it.
Getting Rich Is a Game — Here Are the 5 Pillars To Be Successful at This Game - Follow these 5 pillars to focus your efforts in the right direction.
The Inner Battle You Need To Win for Being Successful - Anyone can achieve extraordinary results with the right mindset.
How To Display a Bitcoin Price Ticker in Words in Your HTML5 Application - A step-by-step tutorial to building a crypto web app
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