Preventing transaction fee collusion between large miners


Does one have to manually confirm a transaction? Or do you preset it somehow to confirm only x transactions with y fees, etc?

No, it's not manual.

To be confirmed, the transaction must be included with the signed block when it's broadcast to the network. There is a limited amount of space in each block, so not all pending transactions can be included with each block broadcast. The Satoshi implementation includes an algorithm that determines transaction priority that takes into account transaction fees, the length of time the coins resided at the source address(es) before being spent, and the size of the transaction itself. Miners using custom software (these days, effectively all of them) can use whatever system they like to decide what transactions to include. Some miners will send blocks with no transactions at all - that's a bit rude, and they're leaving transactions fees on the table, but it happens. Most miners use the algorithm from the Satoshi...

0 0

If your database does not support to create unique ids:
- Set up a table with all random numbers which are sorted by value and its size is stored and available.

Randomly select an element of this table. Get the successor element. If the successor element is a neighbor of the element, take the next successor element. If you reach the last element, start over with the element from step 2 and take now the predecessor. Now simply choose a random range with element-next element and get your random number. Ready !

EXAMPLE: You stored all your ids in a sorted table. Lets assume this is e.g.
{890, 1045, 2345, 2346, 4087}

First step: Select one of them randomly. You get that e.g. by C#

Random random = new Random(); int indexOfNumber = random.Next(0, myTableSize);

Second step: You got the index, lets assume it is 2. You are now getting the next number at index 3, it is 2346. Unfortunately it is a direct neighbor, so you continue to index 4. This is...

0 0

What would prevent the largest Bitcoin mining pools (top 3-4 have with 61-73% hash rate today according to link below) from colluding to demand much higher transaction fees to confirm transactions?

My question is somewhat theoretical and I am aware that many smaller pools would naturally oppose this. However even if transactions get confirmed by smaller pools eventually, when the majority of the hashing power is colluding to only accept high fee transactions, then the delay for confirmations of low fee transactions will be very significant.

Some countries have laws that may prevent this type of collusion, so please assume for the purposes of this question that the colluding parties are either in jurisdictions that do not regulate this or the pools operators cannot be...

0 0

Of all the parts of the Ethereum protocol, aside from the mining function the fee structure is perhaps the least set in stone. The current values, with one crypto operation taking 20 base fees, a new transaction taking 100 base fees, etc, are little more than semi-educated guesses, and harder data on exactly how much computational power a database read, an arithmetic operation and a hash actually take will certainly give us much better estimates on what exactly the ratios between the different computational fees should be. The other part of the question, that of exactly how much the base fee should be, is even more difficult to figure out; we have still not decided whether we want to target a certain block size, a certain USD-denominated level, or some combination of these factors, and it is very difficulty to say whether a base fee of $0.00001 or a base fee of $0.001 would be more appropriate. Ultimately, what is becoming more and more clear to us is that some kind of...

0 0
0 0
0 0
0 0

Last week we asked our miners to tell us what they think about increasing the blocksize. Miners are affected by this change as much or more than anyone else, and we have received a lot of feedback about this issue.

So we hosted a poll. In it we laid out the pros and cons of both alternatives – increasing the block size and not tampering with the blocksize. This is a summary of how we represented each point of view:

Against an increase of the block size: bigger blocks will destroy the market for transaction fees: if block space is not scarce, a market for transaction fees will not be established. Thus, the block reward might dwindle in the long run. requirements for full nodes increase: bigger blocks require more bandwidth which might make it harder to run a full node. For an increase of the block size: capacity too low to support a global payment network: the current transaction amount is not sufficient to support a global payment network. Transactions would...
0 0

This week, we’ve invited Ofir Beigel to guest blog for us. We’ll let him take it from here.

Recently, scaling bitcoin has been a hot topic for the bitcoin community. Why is this? Well, as bitcoin grows and more users hop onboard, a big priority is to ensure the network can efficiently handle the increasing transaction volume. And lately, many users have been expressing their worries over transaction delays caused by network congestion. In this post I’m going to talk a bit about how transaction confirmations work, and the role that fees play in the process.

Miners, bounties, and newly-generated bitcoins

In order to understand transaction confirmations, we’ll need to cover some key concepts of bitcoin mining. I won’t attempt to explain the whole process of bitcoin mining in this post, but I’ll try to simplify the process with this short explanation. Every day hundreds of thousands of transactions are sent and received on the bitcoin network. These transactions...

0 0