3

Can a bitcoin transaction from a specific bitcoin address be banned? (via mining pools)

Suppose Satoshi Nakamoto wants to send some bitcoin from one of his bitcoin address, can the mining pools refuse to process it? (Considering China has 81% total bitcoin hashrate with their pools combined).

I heard that a mining pool could (if they want to) refuse to put your transaction into the mining block, so your tx would be stuck into the mempool, until some other mining pool would put it into the next mining block, but I heard this could not be done forever.

Thoughts?

5

Yes, miners can censor transactions. A mining pool (or solo miner) can choose to not add a transaction to any blocks that they create. And, of course, this can be done dynamically so that transactions that match whatever arbitrary rules they want can be disallowed.

However this only effects one mining pool or miner. Other miners will not necessarily follow the same rules. So if one miner is censoring transactions, then some other miner will probably include them in a block.

But it is also stupid for a miner to censor transactions. All transactions pay a transaction fee and by refusing to add a transaction to their blocks, they are voluntarily taking a lower payout. The transaction fees are there to incentivize miners to include transactions.

1

We don't know for sure, but I doubt it.

It's generally believed that the stakeholders of bitcoin (those who pay the miners) consider censorship resistant extremely important, perhaps the main reason for bitcoin to exist. If this is true, they won't pay for mining if it stops producing the censorship resistance the stakeholders want.

Stakeholders could switch to proof of stake or change the mining algorithm, causing the censoring miners to lose the value of their ASICs and be unable to pay for electricity. The next bunch of miners with the new algorithm will know that they must provide strong censorship resistance if they don't want to go broke.

But this is all speculation. We really won't know until and unless someone tries and we see whether the stakeholders tolerate it or not. It seems highly unlikely to me that any significant number of miners would ever take this chance since they would be endangering their own existence.

  • Or they can become miners themselves. – Pieter Wuille Nov 19 at 6:35

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.