“The main problem with bitcoin is privacy”

The CEO of the large mining pool Poolin, Kevin Pan, believes that privacy is one of the main problems of bitcoin, which requires a priority solution.

“The real problem with bitcoin is privacy. If it is solved, then there will be no other serious problems, ”he said.

According to Pan, the authorities and law enforcement agencies are already creating black lists of addresses for transferring funds, and soon there will come a time when certain transactions will not be possible at all. However, if proper privacy is created, no one can determine the owner of the address or the amount.

The task voiced by Pan is directly related to the centralization of computing power in the Bitcoin network, because the above-described plan of authorities can be implemented only if they can calculate and involve more than half of the miners in cooperation.

Pan believes that the solution to current problems may be associated with the creation of new protocols aimed at decentralizing the network. He said:

“Now mining pools play an important role and have huge powers. They have the right to vote and they can decide which transactions to add to the blocks. Every day, an average of 144 new blocks are generated, so mining pools will inevitably become intermediaries for miners. Currently, the 10 largest pools control 95% of the computing power, and this is a serious problem. ”

Pan sees the United States as China’s competitor in the mining industry, since the United States has an abundance of coal and hydropower resources. However, now retail investors cannot enter this business:

“To create mining factories, millions of dollars, people, squares and energy resources are needed. Ordinary retail investors do not have all of this. It is much easier to buy five miners and put them in the enterprise. But enterprises do not want to work with so much equipment; they need hundreds of machines. To reach a decent level, you need to buy at least 100 mining devices and spend 1 million yuan ($ 140,000) on it. Such amounts are not affordable for retail investors, so they are far from the mining industry. ”

Pan also noted that he expects to see a rise in the Bitcoin exchange rate in the long term, but this does not have to be connected with the halving of the mining reward.

“Halving the reward is the strongest economic signal, but it may not have a real impact on the price. Only 900 fewer bitcoins will be mined per day, which is not so much, especially when compared with the trading volume. Therefore, psychological factors have a much greater effect on quotes. Only a reason is needed that will push the price. ”

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