Bitcoin Mining Pool F2Pool Under Scrutiny

F2Pool, the third-largest Bitcoin mining pool, faced criticism on social media following a report that it might be censoring transactions from a U.S. sanctioned address. This incident has raised concerns about the censorship resistance principle, fundamental to Bitcoin’s ethos.

Report of Potential Censorship

A blockchain-focused blogger, 0xB10C, reported that F2Pool might have excluded transactions from OFAC-sanctioned addresses. While some instances might be false positives, the report suggests that F2Pool likely filtered certain transactions.

Mining Pools in the Bitcoin Network

Bitcoin mining pools like F2Pool are collectives where miners combine their efforts to stabilize income from block rewards. F2Pool’s significant share of the network’s hash power, accounting for about 14% of mined blocks, means its actions can impact the network broadly.

F2Pool Co-Founder’s Response

Chun Wang, F2Pool’s co-founder, stirred controversy with a now-deleted post on X (formerly Twitter), seemingly justifying the filtering of transactions from “criminals, dictators, and terrorists.” He later stressed the need for censorship resistance at the protocol level, suggesting Bitcoin should learn from the Internet’s shortcomings in this area.

The Bitcoin community responded negatively to these developments, emphasizing long-standing consensus against censorship. Some members warned of potential backlash against F2Pool.

Inactive Bitcoin Supply Hits Record High

In a related development, Glassnode data shows a record 70.35% of Bitcoin’s circulating supply has been inactive for at least a year. This trend indicates strong holder belief amid crypto contagion and macro headwinds.

Market Reaction to Binance Settlement

Crypto markets, including Bitcoin, showed resilience following the Binance settlement and CZ’s resignation. Observers suggest this development might pave the way for the U.S. SEC to approve a spot bitcoin ETF, with expectations for compliance in the industry heightened.