The one good thing if China ever bans Bitcoin: More decentralization

Okay so what do I mean by "More decentralization"? Well I mean that China is, well a very large amount of the total network hashrate. I'm not talking about China as a whole, I'm talking about a few pools based in China. Meaning a couple groups of Miners control a large amount of the total network hashrate. Well why is this even a bad thing? More miners mean more Bitcoins being created, and more miners mean more transactions being processed, meaning a faster network.

And that's true, a large amount of not only hashing power comes from China but a large amount of trade volume also comes from China as well. The reason why so much hashing power comes from China is because energy is cheap and SHA-256 ASIC chips can be made cheaply as well, so ASICs can be cheaper. But if Bitcoin is banned in China it could have devastating effects to the market. Not only would a large amount of the hashrate suddenly disappear but a large amount of trading volume would also disappear. Bitcoin's price would not only plummet but it would cause other cryptocurrencies would also fall somewhat. China banning Bitcoin is really something that we do not want.

Or is it? You see the risk of having a very large majority of the hashing power being controlled by a few pools is that whoever runs the pool that controls 51% of the networks hashing power could do what's called a "51% hashing power attack". What is a 51% hashing power attack? Well a core functionality coded into Bitcoin that many have pointed out to be a massive security flaw, is that if a miner or group of miners have 51% of the networks hashing power, they can do many things that could completely destroy the currency.

First of all, they could choose to not accept certain transactions, double spend coins or just make a infinite amount of coins, or just reverse already spent transactions. Or they could just not allow the other 49% of miners to find a block. If this were to ever happen, Bitcoin would crash and burn straight in it's tracks.

However, a person or group controlling 51% of the hashing power probably wouldn't do anything of the sort as they would just make more money by mining by itself. But they still could do any of the things I said before, whenever they please. This is the complete opposite of decentralization, and thus the complete opposite of Bitcoin as a whole.

So what could we do if something like this happened? Well not much. You could DDOS the pool and shut it down, but that wouldn't get rid of the hardware. But since at this point Bitcoin is no longer fully decentralized, you could just take down the central place mining all those Bitcoins or take down the pool in the physical world. The fact that this could happen one day is very concerning when talking about the future of Bitcoin. Bitcoin was supposed to be decentralized so no one would be a central control, and if a government tried banning Bitcoin, it would still live on due to there being no centralized place controlling the network.

Is a 51% hashing power attack going to happen in the near future? Probably not. Again you would be making a lot more in profit by just mining legitimately. But the fact that pools have gotten worryingly close to 51% of the total network hashrate is something that should be thought about. So China banning Bitcoin would be something no one wants, and would leave more than a dent in the market of Bitcoin. But if the large pools in China keep gaining more and more of the total network hashrate, a 51% hashing power attack might not be so far off of reality.

The whole situation is indeed, a very nasty double edged sword.