Decentralization means different things for different people. It can also be applied to a variety of different variables, from the technological to the cultural. How much of bitcoin’s cultural aesthetic is what keeps block size (within the network) or the number of bitcoins fixed? How much of decentralization is the technical balance between miners, nodes, and other stakeholders in the network that accords each different powers and responsibilities?

An increasingly common argument among those criticizing the decentralization of proof-of-work systems is the centralization brought by lower hardware and electricity costs and the high degree of mining hash rate concentrated in “Chinese” mining pools. This has, for example, been a long-standing thread that has been pushed by Ripple CEO Brad Garlinghouse, with the Ripple team also making allegations that both ethereum (in its current proof-of-work consensus algorithm) and bitcoin are controlled by China as a result of the mining pool concentration.

The first thing to understand about this argument is that mining pools command loyalty not based on geographic traits or even political ones, but rather, reward types, fees, and how the pool deals with bitcoin transaction fees.