I've released Litecoin 0.5.0.6:
- Has the fix to reduce transaction spamming by allowing only 500 bytes of exempted transactions as oppose to 3000 bytes (in Bitcoin)
- Change the priority cutoff of free transaction to 1 litecoin day per 250 bytes.
- Disabled encrypt wallet feature since it's currently broken. encrypted wallets might still have private keys in the clear so be careful if you've already encrypted your wallet.

https://github.com/downloads/coblee/litecoin/litecoin-windows-client-0.5.0.6.zip

I've tested this on testnet. You can see that we now only exempt 3 low priority transactions per block:
http://blockexplorer.sytes.net/chain/LTCtestnet?hi=7447

Everyone, please update to the latest code and this will reduce the transaction spam and slow down the chain growth.

So, it looks like the 0.00000001 transactions are not happening much anymore:
http://blockexplorer.sytes.net/chain/Litecoin?count=100&hi=34342

But we are still seeing the 13 2ltc transactions. I assume people are ok with the decision to change the exempt free coins block size to 1k. I will do that and release a new client soon.

That's my thought also. And since we find 4 times as many blocks as Bitcoin, the exemption in terms of time is about the same: 4kb per 10 mins.


Bitcoin has been around for more than 2 years now and its chain size is still only ~700mb. If we grow 1GB a year, it's not that bad but forcing everyone to download 1GB of mostly useless transactions is stupid.

It's still happening because some miners have not upgraded and they are happily include the spammer's transaction that don't include enough fees.
If you look at http://blockexplorer.sytes.net/block/9171504e9427f74c02a0b2ad6167832f974ee2959135025a8407b7e9f4a74cef you will see that his transactions are being charged less than 0.1 ltc.
If he was following the new fee rules, we would have need to pay 200x the fees he paid, or 200 * 0.2205 = 44.1 ltc.
So until enough people start to use the new code, you will still see these transactions creep in. Of course, if he had the resources, he could find his own blocks and pay no fees, but he's not doing that right now.

The other disturbing thing I'm seeing is that after the fix has been released, he started sending 2 ltc to himself and maxing out on the 4kb of free transactions per blocks. So you see those blocks with 14 transactions: http://blockexplorer.sytes.net/chain/Litecoin?count=500
13 of these transactions + the generate transaction will max out the amount of free transactions allowed in the block. I know it's the same guy because I followed his transaction back and saw that the same coins were used in both of these attacks. Just look at this transaction: http://blockexplorer.sytes.net/tx/456af81d3bfa3d92ca03e04066aaceca64babeec961dd1474026706eaa4459d9
Some of those coins were used in the 2 ltc spam and the rest were used in the 0.00000001 ltc spams. This guy is really annoying since he seems to have a deep knowledge about how to take advantage of the transaction fee rules.

From the wiki: So 14 of these transactions are costing him nothing b/c he's sending them to himself. This is not as bad as the first attack, but it will still grow the chain by about 2.3mb a day. (4kb * 576 blocks)
This is not a big problem with bitcoins, because Bitcoin has a lot of honest transactions that use up the 4kb in the block, so these spammy low priorties transactions will take forever to get included in a block. So a similar attack on bitcoin is pointless. Since Litecoin is a new chain with not that many honest transactions, it's silly that we are forced to grow at 2.3mb/day by this Litecoin-hater.

I will need to think of a way to combat this. The first thing that comes to mind is to just reduce the 4k exemption for free transactions per day to something much smaller. Maybe instead of allowing 13 of these transactions, we only allow a few to get included in a block. I can reduce the 4k exemption to 1k. This would reduce the chain size increase from 2.3mb/day to 575kb/day. The downside of course is that free transactions might take longer to get written into blocks. I would have to double check, but I don't think the client will let you create transactions without enough fees. So this only applies to people that modify their client to do 0 fees. Let me know what you guys think.

Lots of transactions is not bad. Large transactions that sends small amounts of coins to lots of outputs is bad. The fix is not arbitrarily forcing the number of transactions down. It is only going to incur a fee on low priority transactions, which are those that have lots of inputs and/or outputs and uses small amount of coins that don't have a lot of confirms. Again, please read the wiki: https://en.bitcoin.it/wiki/Transaction_fees

Thanks. I hope it's clear why we need this transaction fee. Since this is a p2p network, sending large transactions (in terms of bytes) will add strain to the network to propagate those transactions and to store them. Look at how much the block database has grown from these spam transactions. So the increased fees is to combat that. If you want to waste other people's resources, you can but you need to pay for it. And most transactions will still be free.

Yes, from what I can tell the Bitcoin fees were always around 1/10 of a cent. Anything less and it will make it cheap for an attacker to spam the network. So that's why I decided on 0.1 LTC for the fee. Anything less and the attacker will just keep on spamming. Could I have started a poll and asked people for what they wanted? Sure, but do you know what the vote would look like? Everyone would vote for very very low fees b/c no one wants to pay any fee. But people don't understand why we need a fee right now. So I actually have to make a decision to set a fee higher than what people wanted because I have to weigh the importance of using the fee to deter an attack with people's desire to have no fee.

So yes, I made a decision that I thought was best for Litecoin. I felt like I had to act quickly before the transaction spam gets too out of control. And getting everyone to understand why we needed a 0.1 LTC fee would have been an impossible task. Look how many posts I had to make on this subject, and still, most people don't even understand that the fee is not a static fee that's applied to every transaction. So if people want to keep on discussing this topic, please read this wiki page and try to understand why we need a fee for low priority transactions: https://en.bitcoin.it/wiki/Transaction_fees


In the future, as ltc price goes up, I will reduce the fee to keep it at about $.001. I don't think we need to have a poll or a long discussion whenever I decide to lower the fees, right? Or do we? If people really cared, I will.

We can discuss to see if there are better solutions. I thought of tying the fee to the current difficulty, which is loosely correlated with the price. That way we don't have to constantly change the fee and we will let the market determine the fee. Gavin had ideas about letting miners set the fee somehow. But I'm sure a lot of people won't be happy about that solution. But all this will take a while to flesh out and implement. In the meantime, I made the fee structure effectively equivalent to Bitcoin. And I was surprised to see so much complaining on the forums.


I'm shocked to read that... I really don't know what to say.

Litecoin does but the fee was set too low b/c 1 LTC == 0.006 BTC.
So I had to adjust the fee to be 200x that of Bitcoin to keep the cost to the attacker the same.

I've stated many times that most transactions will not incur a fee just like Bitcoin. This fee is just to deter people who send a lot of low priority transactions.

The fee is just the default fee in the default client for low priority transactions. Miners can choose to accept free transactions or not accept any transactions without a fee. This works the same way as Bitcoin.

Due to someone sending transaction spam, I had to update the fees to make it more in line with Bitcoin fees in order to deter the spam.

Litecoin version 0.5.0.6 has been released.
- added minimum fee of 0.1 LTC for low priority transactions to deter transaction spam
- reduce transaction spamming by allowing only 500 bytes of exempted transactions as oppose to 3000 bytes (in Bitcoin)- changed the priority cutoff of free transaction to 1 litecoin day per 250 bytes.- disabled encrypt wallet feature since it's currently broken. encrypted wallets might still have private keys in the clear so be careful if you've already encrypted your wallet.

Please get latest from source or download the Windows client binary:
https://github.com/downloads/coblee/litecoin/litecoin-windows-client-0.5.0.6.zip

Pool operators and solo miners should get this latest code so that you don't write these spammy transactions into blocks. Users should download the latest client so they don't propagate spammy transactions and let them slow down the client.

I did not ignore your comment. I explained why your suggestion of 0.001 LTC is too low. And I also showed why 0.1 LTC is close to Bitcoin's fees in terms of dollar value. And since the purpose of the fees is to deter DDoS'ing of the network using transaction spams, having a high enough fee is important.

This is a problem that Bitcoin ran into in its early days and it has solved this problem using a complicated formula to assign a fee if the transaction is a strain on the network. The idea is that if you keep reusing coins and send them in large transactions (in bytes), then you need to pay a fee. This makes it costly for a malicious person to keep sending these micro transaction spam to try to hurt the network. But for everyday users, you will not have to pay a fee unless you are using coins you just received. Please read up on this if you want to know more: https://en.bitcoin.it/wiki/Transaction_fees

Let me repeat and state that this is not a change in the economics. Litecoin had fees that were too low and made it cheap for someone to launch this attack. So I had to fix it to make the fees in line with Bitcoin in terms of dollar value.

If you want to discuss a solution that's better than the one Bitcoin currently uses, feel free to throw out ideas. I will listen. But please don't just complain that the fees are too high. If you are the attacker, then yes, fees are too high and that's the whole point. This will not have a huge impact on normal users. Most people would agree that they would rather spend a 1/10th of a penny on low priority transactions in exchange for not having a network that's crawling due to attacks by spammers.

I think it's perfectly okay for people to toss them right now. It would be a 20 cents conversation starter. It would do a lot to help promote Bitcoin IMO. And if they do toss them, so what? It's just 0.1 btc lost forever. But imagine the day when 0.1btc is worth something and people started finding them in couches. That would be funny.

Another method is to use StrongCoin to import the mini key and then send those coins somewhere else. Having a website that explains to average joe what Casascius coins are and how to redeem them would be very helpful.

I think you should stick to 0.1 btc. I would buy at least 100 of them if not more. And you should preload them all. Doesn't make sense for people to load them themselves.

And please put on your website information for people who received these coins and just googled casascius.

New Litecoin released with increased fees to deal with transaction spam:
https://bitcointalk.org/index.php?topic=47417.msg621650#msg621650

Bitcoin fee is 0.0005 btc, which is $0.0011 at today's prices.
At 0.1 ltc fee, which is 0.00063 or $0.0014 at today's prices.

I think that's about right. As ltc prices rise, I will readjust the fees as necessary.

Litecoin version 0.5.0.5 has been released.
- added minimum fee of 0.1 LTC for low priority transactions to deter transaction spam

Please get latest from source or download the Windows client binary:
https://github.com/downloads/coblee/litecoin/litecoin-windows-client-0.5.0.5.zip

Pool operators and solo miners should get this latest code so that you don't write these spammy transactions into blocks. Users should download the latest client so they don't propagate spammy transactions and let them slow down the client.

As terrytibbs said, this won't totally fix the problem, as the spammer can still write his transactions into blocks he finds himself. But it should reduce the network congestion of propagating these spammy transactions and reduce the number of blocks that contain these transactions.

By larger transaction, I mean transaction that are large in terms of bytes. So a transaction with a lot of small 0.00000001 outputs will be considered a large transaction. Yes, bitcoin was at 0.01 BTC fee earlier this year. But I don't know what the fee was when Bitcoin first came out.

Please note that I am not changing the economics of LTC. The fees in Litecoin and Bitcoin are currently there to deter spam and ddos attacks. Litecoin had fees that were too low given the price of litecoin to do a good job at deterring transaction spam. And remember that free transactions are still allowed as long as you use coins that are old enough and your transaction is small (i.e. not creating a ton of small outputs to spam the network).

Your suggestiong of 0.001 LTC fee is likely too low as a million of these transactions only costs 1000 LTC, which is just $6.

I've been talking to a lot of people about this issue on IRC. At first, I wasn't going to do anything about it b/c the guy isn't totally malicious. He's actually donating coins to people. But it seems like he's not going to stop and the size of the chain is growing big. And since our fees are too low, he can keep doing this forever and it won't cost him much. So it makes sense to increase the fees to make it at least cost something to perform this DDoS spam attack.

Since I believe this change is pretty harmless, I didn't think we needed to have a long discussion about this. If you think 0.1 LTC is too little or too much or if you have another way to solve this problem, please post it. We can always put in a better fix later. But I think I need to act now to address this problem.