Author: Ryan J Martin 2017-12-01 07:58:01
Published on: 2017-12-01T07:58:01+00:00
William Morriss proposed the idea of Marginal Pricing in a Bitcoin Improvement Proposal (BIP) to address the challenges faced by the current transaction market. The proposal aims to maximize total transaction fees, reduce pending transaction time and lower individual transaction fees. The proposal suggests that miners implicitly choose the market sat/byte rate with the cheapest-fee transaction included in their block, and excess transaction fees are refunded to the inputs. The block size limit is removed to allow for a dynamic block size limit regulated by profit motive. The proposal also anticipates two markets: a backlog market and a real-time market. Users targeting the backlog market would match the price of the largest backlog section in order to be included in the next backlog block. However, there are some challenges to implementing this proposal. Validators must agree on the maximum block size, or else miners may include extra transactions to cheat. Allowing too many transactions per block will increase mining cost without collecting much income for the network. Additionally, minimizing individual user transaction fees and maximizing total transaction fees are essentially incompatible within the current development structure. Furthermore, Greg Maxwell's response highlights some of the biggest pitfalls of the proposal, and he states that behavior in response to such a change could be hairy to predict.
Updated on: 2023-05-20T04:26:37.170918+00:00