Author: Prayank 2022-01-21 23:45:34
Published on: 2022-01-21T23:45:34+00:00
The Bob-Pays-For-Transaction (BPFT) policy is a new concept for improving the fee market in Bitcoin through CPFP. The idea is that recipients pay fees for transactions instead of senders, which could potentially promote more adoption of CPFP and improve the fee market. This could also be useful for projects that use market making, like the maker-taker model. The BPFT policy could resolve issues with miner revenue and security and would allow recipients to care about the urgency and security of the payment in many transactions. According to Sergej Kotliar, there are some issues with this policy such as the fact that receivers would send their unconfirmed coins onward expecting others to pay the fees until someone considers the transaction important enough to be confirmed soon. Additionally, if the receiver pays via CPFP, it can become exploitable if known about them. Receiving wallets could provide easy options to use CPFP and pay fees that confirm the parent transaction. The CPFP calculator by djbooth07 or effective fee rate shown in explorers like https://mempool.space can be helpful. On the other hand, spending wallets would broadcast all transactions with 1 sat/vB. It should be noted that Bitcoin Core does not allow users to spend unconfirmed UTXO using GUI and most of the RPC in CLI, however, Kristaps made an interesting point in the linked issue that it could be allowed for transactions that do not signal RBF. It is not considered safe, but a lot of wallets allow this, including Wasabi in which some UI/UX issues related to unconfirmed UTXO were recently found. Finally, it should be noted that the whole fee paid for such transactions wouldn't be paid to the miner confirming the transaction but it would be shared between the miners creating the next N blocks.
Updated on: 2023-05-22T16:36:48.116960+00:00