How a handful of Chinese companies that control a majority of the Bitcoin network are playing a central role in the community's civil wars
A delegation of American executives flew to Beijing in April for a secret meeting at the Grand Hyatt hotel, just blocks from Tiananmen Square.
Context & Ripple Effects
This closes out the Times' two-day examination of how a handful of Chinese companies came to run a majority of the Bitcoin network — and why that control now sits at the center of the community's civil wars. The telling detail is the April meeting: American executives flying to Beijing for closed-door talks at the Grand Hyatt, blocks from Tiananmen Square, because the decisions that matter are no longer made on mailing lists but wherever the majority hash power sits.
The arc matters because the geography inverted afterward. Beijing moved from tolerating this concentration toward trying to harness tech companies' capital and knowledge for state goals, per the 2018 coverage, and eventually cracked down on crypto outright — leaving today's Chinese traders operating through VPNs, offshore shells, and peer-to-peer networks.
First-order effects
- American Bitcoin businesses must negotiate protocol direction face-to-face in Beijing with the Chinese companies holding majority network control, shifting decision-making from open community forums to private meetings.
- The Chinese mining companies gain de facto veto power over the community's civil wars: whichever way they signal, the majority of the network can follow.
Second-order effects
- Other Bitcoin constituencies — developers, exchanges, Western miners — are pushed to court or accommodate Beijing-based operators, since any proposal without majority-hash support cannot win.
- Concentrating the network's operational core in one jurisdiction invites exactly the state attention the later coverage documents, turning a technical governance dispute into a geopolitical exposure for every holder of bitcoin.
Third-order effects
- If critical infrastructure keeps concentrating where costs are lowest and policy is permissive, protocol governance migrates from distributed communities to whatever government hosts the operators — a dependency that surfaces violently when policy flips, as China's crackdown did.
- The post-crackdown pattern of VPNs, shell companies, and secretive meetings shows the deeper lesson: suppressing the activity doesn't relocate the expertise, it just drives the same concentration underground and offshore.
The trend: Bitcoin's governance has been migrating from its community toward whoever controls the physical network — first Chinese mining companies, then, after the crackdown, an offshore and underground diaspora running the same playbook.