Behind the two mining pools that control 51% of the global hash rate

Haru Invest

While most of the market is focused on Bitcoin price volatility, a much bigger issue seems to go unnoticed.

The centralization of Ethereum has been one of the hottest topics in the cryptocurrency industry since the network moved to Proof-of-Stake, with many critics warning of the dangers of a cryptocurrency with such a large market cap relying only on a handful of centralized validators.

Since the coveted mining ban in China, the centralization of the Bitcoin network has mostly disappeared from mainstream discussions and has become the focus of a niche group in the mining sphere.

However, the centralization of Bitcoin is a problem that affects the entire market, especially now that only two mining pools produce the majority of its blocks.

CryptoSlate looked at the global hash rate distribution of Bitcoin and found that more than half came from Foundry USA and Antpool.

The two pools have each mined over a quarter of the Bitcoin blocks in the past ten days. Since mid-December, Foundry USA has mined 357 blocks, while Antpool has mined 325. Foundry’s block production accounted for 26.98% of the network, while Antpool was responsible for just under 24.5% of total block production .

bitcoin hash rate distribution mining pool
Graph showing the estimated hash rate distribution among the largest Bitcoin mining pools (Source:

Antpool has been at the forefront of Bitcoin mining for years and has produced nearly 14% of the blocks mined in the past three years. On the other hand, Foundry is a relatively new name in the mining space. However, it quickly rose to become one of the top ten pools by hash rate, accounting for 3.2% of blocks mined over the past year.

A closer look at Antpool and Foundry USA shows an alarming level of centralization and a network of interconnected companies that effectively own half the network.

Foundry: DCG’s mining behemoth

It took less than two years for Foundry USA to become a force to be reckoned with in the Bitcoin mining space. The mining pool is owned and operated by the Foundry of the same name, a Digital Currency Group (DCG) company created in 2019.

By late summer 2020, Foundry was already among the largest Bitcoin miners in North America. In addition to mining, the company offered financing and equipment procurement. By the end of 2020, Foundry helped procure half of all Bitcoin mining hardware delivered to North America.

Foundry’s huge success as an equipment contractor and miner stems directly from DCG’s influence in the cryptocurrency industry.

The venture capital firm is one of the largest and most active investors in the industry, backing more than 160 crypto companies in over 30 countries. DCG’s portfolio is a roster of the biggest players in the industry:, Blockstream, Chainalysis, Circle, Coinbase, CoinDesk, Genesis, Grayscale, Kraken, Ledger, Lightning Network, Ripple, Silvergate, and dozens more.

Foundry is its wholly owned subsidiary that serves as a one-stop shop for all of these companies’ mining needs. The rapid growth of Foundry USA’s hash rate has led some to speculate that DCG’s companies were contractually obligated to do all of their mining through the Foundry pool. However, it’s important to note that neither DCG nor any company in its portfolio has confirmed this.

The mining ban instituted in China last year has also helped.

Forced out of China’s abundant and cheap hydroelectric power, the miners were looking for alternative locations that offered at least a fraction of their profit and a more welcoming regulatory environment.

The United States presented itself as a perfect relocation location, offering miners a wide selection of locations and sources of energy. And having a mining pool as large as Foundry USA on hand certainly didn’t hurt.

Antpool — Bitmain’s monopoly

Founded in 2014, Antpool is one of the oldest operating mining pools on the market. Often accounting for over a quarter of the global hash rate, Antpool has almost never left the top ten largest mining pools.

The success of the pool is its seamless vertical integration: it is owned and operated by Bitmain, the world’s largest mining hardware maker. The company behind the Antminer series has been supplying its pool with the latest and most efficient Bitcoin hashes, helping it to remain profitable even in the coldest crypto winters.

Bitmain’s influence on the global cryptocurrency market has led many to speculate that the company was forcing its large buyers to mine with Antpool. Since both Bitmain and Antpool are based in China, many are also concerned about the country’s influence over such a large part of Bitcoin’s hash rate.

The corporatization of cryptocurrency mining

It is important to note that a mining pool differs from a private mining operation. Unlike a private miner, a pool represents the joint hash rate of many machines owned by various entities.

Owners of mining machines, or hashes, divide the profits generated by the mining pool based on the size of their contribution.

The fact that Foundry USA accounts for a quarter of Bitcoin’s hash rate doesn’t mean that DCG owns every machine that produced it.

However, Foundry provides the foundation and roof for its customers’ mining operations. The company’s weaknesses could shake up a significant portion of the Bitcoin network and leave thousands of miners and smaller machines to fend for themselves if it were to shut down.

The same can be applied to Antpool.

The rate of centralization of these two entities imposed on the industry becomes even greater when you look beyond just Bitcoin. Antpool also has pools for other cryptocurrencies: Litecoin (LTC), ZCash (ZEC), Bitcoin Cash (BCH), Ethereum Classic (ETC), and Dash (DASH), just to name a few.

Foundry offers enterprise staking support for Ethereum (ETH), Solana (SOL), Polkadot (DOT), Avalanche (AVAX), and Cosmos (ATOM). The company does not disclose the number of assets it manages.

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