[Bitcoin-ml] Transaction mining priorities.

Jeff Garzik jeff at bloq.com
Tue Sep 19 14:21:51 UTC 2017

The miners have two notable incentives:

1) Maximize fee revenue
2) Minimize time spent creating blocks

It has long been a goal to remove the 2nd pass through the mempool for
transaction priority.  Miners will prefer fewer CPU cycles spent building
new blocks, and prefer more revenue to less.

On Tue, Sep 19, 2017 at 7:44 AM, Tom Zander via bitcoin-ml <
bitcoin-ml at lists.linuxfoundation.org> wrote:

> I’m writing here to ask for feedback before I implement this in Classic.
> This is a copy of a less technical and more aimed at the broad audience
> text
> on Yours.
> https://www.yours.org/content/
> 3135d4927234a736b972e6f669aba8d78c3ef74ce87facfb68c2ad055a9dec03
> Transactions are picked by the miners currently based on the amount of fees
> they pay. Zero-fee transactions have been seen as people taking advantage
> of
> the system for some time. And I think its time to look at this and find out
> if that actually makes sense.
> I want to propose that miners start to prioritize transactions based on the
> properties of the individual transaction. The higher the priority, the
> better chance of inclusion in the next block. The factors of giving
> priority
> are;
> 1. Coin-age of spent coin (days-destroyed). Older is better.
> 2. Ratio of inputs to outputs in one transaction. More inputs is better.
> 3. Sigops count. Less is better.
> 4. Transaction size in bytes. Smaller is better.
> 5. Fees paid to the miner.
> This change essentially means that if your transaction scores high in any
> of
> the first items, that means the fee you need to pay to get mined goes down.
> The reason we have been told fees were good is because they would protect
> us
> against spam attacks.
> And I see that need, if we drop fees then people could create many many
> transactions with the effect that if I went and tried to pay my beer in the
> pub, it would not go through. We can't ignore that threat.
> I would argue that this problem can be solved much better with "Coin Age".
> Money I received a month ago would have a higher priority to be mined. This
> makes sense because it rate-limits the "spammer" to one transaction a month
> if his goal is to stop me from being able to spend my money. So the longer
> a
> coin is untouched, the higher priority it gets.
> If a spammer spends tons of 10 minute old coins, it would have no effect on
> real uses transactions that in general are quite a bit older.
> Point 2 is a bit more complex.
> A transaction that has outputs consumes space in the UTXO (unspent
> transaction output) database. Its inputs remove rows in that database. So
> stating we prefer a ratio where the database gets smaller is a good idea.
> Especially if that means people can pay a lower fee to get their
> transaction
> mined.
> But that is not the full story.
> Imagine how a mining pool, or even Yours is handling transactions. There
> are
> a lot of people paying very small amounts to a single person. Each payment
> to you is added to your balance, but on the blockchain you have hundreds of
> inputs to sign in order to move that money afterwards. At some point
> creation of a single output is useless because it would be too expensive to
> spend it later (due to fees).
> With point 2 giving a higher priority the natural consequence is that
> spending those hundreds of tiny transactions you received requires a much
> lower fee. And this brings into question the setting of the 'dust limit'.
> We can probably significantly lower the dust limit when its no longer a
> problem to spend inputs that are not holding a lot of value each
> individually.
> How do you see this priority table? Is it better than the current one that
> only looks at fees?
> How would you feel about the implied effect to lower the dust limits?
> --
> Tom Zander
> Blog: https://zander.github.io
> Vlog: https://vimeo.com/channels/tomscryptochannel
> _______________________________________________
> bitcoin-ml mailing list
> bitcoin-ml at lists.linuxfoundation.org
> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-ml

Jeff Garzik
CEO and Co Founder
Bloq, Inc.
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