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1  Bitcoin / Development & Technical Discussion / Discussion: optimization of mempool fee levels on: April 03, 2019, 02:06:33 PM
I'd like to discuss a possible change to the bitcoin core wallet that does not impact consensus rules.
Right now bitcoin core nodes are still the vast majority and over 60% are recent versions of bitcoin core (>16.3)
Say the mempool is like this:


What we can see from this visualisation of the mempool is that there are 5.3 MB of transactions that span from 1 sat per byte to 40 satoshi per byte (we will leave extremely expensive transactions (red color) aside for a second).
That means that we could compress all those transactions into just 6 fee levels:
5 MB with fees from 1 to 5 satoshi per byte
0.3 MB with fees of 6 satoshi per byte.
Instead of 40 satoshi per byte!!

Edit:
What I want is to give the option to nodes to set a parameter of maximum allowed overpaying.
For example I would set this parameter to 1 sat/b while you may set it to 5 sat/b and someone else might leave it unlimited like it is now.
Eventually I think that having this option would lead to people using it and force wallets to improve their fee estimation to be sure everyone relays their tx
It is like a cold-war weapon. You don't have to use it, just having it ready does change stuff.
Of course people could just ignore it, but by just implementing it and having it available would be a signal for the network:
- hey be careful that if you overpay you risk to not have an optimal propagation of your transaction.
A block explorer could tag those transactions with a warning saying: "this transaction payed too many fees, this could mean it is not relayed optimally by the network and therefore could not be confirmed quickly"
Please RBF it to a lower fee to make sure it pays a reasonable amount


We can achieve this by having bitcoin full nodes not creating or including in their mempool:
- transactions that pay more than (insert here your selected option, mine is: 1) 1 extra sat/b when compared to the other transactions in the node mempool unless there are already enough tx to fill at least 1block (4000 KWU)

When including transactions in their mempool the nodes would basically start from those paying 1 sat per byte and include those, then move to those paying 2 sat per byte.
After that the nodes would check if there are enough transactions that pay 2 sat/b to fill 1 block (4000KWU). If true then it starts to include the transactions that pay 3 sat/b, if not it stop until there are.
In general I think this would make sure that the mempool grows in a gradual way, without any holes in it like those you can see in the image at 8 sat per bytes where there are very very few transactions.
One possible downside of this is if you have to create an expensive cpfp.

The power of a default setting and the incentive that, if the majority of wallets implement this “best practice”, the prices of the mining fees become rational and optimized should hopefully enough to push people to implement something like this in any wallet.
I know and understand that mining fees need to exist and I think that it is right to develop a fee market. But at the same time we should encourage the users of the wallets to not overpay for their tx to get fast confirmations because, not only do they not gain anything personally by doing that, but they also could create a spiral in the price of the mining fees that can damage Bitcoin.
In some ways it is similar to batching. No one can stop a big exchange if they want to send millions of single  transactions to each of their customers when they buy or sell. Coinbase did that for quite some time.
But eventually it should become a best practice to batch transactions to minimize the footprint on the bitcoin ecosystem.
Exactly the same for this proposal.
No one can stop you to use your own wallet that let you create a tx that pays double the fees of everyone else and get into the next block. But you could’ve been included anyways by paying just 1 more sat/b than the highest fee level. And by doing that you also don’t make it more expensive for everyone else.
2  Bitcoin / Bitcoin Technical Support / connecting a spv wallet to my full node on: August 09, 2017, 07:51:46 AM
Hello,
Open source mobile app spv wallets that give me the option to connect to my own full node at home?
Thanks
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