How Does the Cost of Internet Bandwidth Affect Mining Decentralization?
The cost and availability of high-speed internet bandwidth affect mining decentralization by favoring large, centralized mining farms. To remain competitive, miners need to quickly receive new block templates and broadcast their solved blocks to minimize "stale" rates.
Large, well-connected data centers in regions with cheap bandwidth have a competitive edge, which can lead to a centralization of mining power away from smaller, remote operations.
Glossar
Internet Bandwidth
Bandwidth ⎊ Adequate internet bandwidth represents a foundational prerequisite for seamless participation within cryptocurrency markets, options trading platforms, and the broader landscape of financial derivatives.
Mining Decentralization
Distribution ⎊ Mining decentralization refers to the extent to which the total computational power, or hash rate, securing a Proof-of-Work network is dispersed among numerous independent entities rather than concentrated in a few large mining pools or facilities.
Bandwidth
Throughput Capacity ⎊ Bandwidth, in the context of distributed ledger technology and trading systems, quantifies the maximum rate at which data, such as transaction requests or market updates, can be reliably transmitted across the network infrastructure within a given timeframe.