BetterHash, an attempt to make Bitcoin mining more decentralized

Quick Take

  • BetterHash is a new mining protocol with the aim to make mining pools more decentralized
  • The idea was proposed by Bitcoin Core contributor Matt Corallo

One persistent problem in the Bitcoin ecosystem is the centralization of mining, specifically, in the hands of mining pools.

Mining pools are entities through which bitcoin miners combine their computing resources (hash power) to coordinate mining activities. This process provides would-be individual miners with a regular payout of block rewards and transaction fees, as the mining pool rewards miners based on how much hash power they are contributing to the pool, not who was first to find a bitcoin block.