Published on: 2017-03-31T21:17:16+00:00
The distribution of fees in bitcoin transactions is a key aspect to consider. Most of the income is generated from transactions with fees near the "Lowest Invested First Basis" (LIFB). However, there is concern that miners may choose not to fill blocks completely if low fee marginal transactions end up costing them money. This could have negative implications for Child Pays For Parent (CPFP), where a parent fee is not considered as LIFB.A proposal was made on the bitcoin-dev mailing list by user praxeology_guy to change the fee policy for bitcoin transactions. The suggestion is to reduce all fee/byte in a block to the lowest included fee/byte and allow transactions to specify which outputs receive what portions of the transaction fee. However, this approach may incentivize miners to not fill blocks completely if low fee marginal transactions become unprofitable for them. An alternative approach proposed is to incentivize miners to prioritize transaction fees more by reducing mining rewards. This could be achieved through a soft fork that requires a portion of all mining rewards to be sent to an unspendable address.The proposed hard fork change involves refunding excess fee amounts higher than the lowest included fee in a block. This change would result in all fee/byte in a block being reduced to the lowest included fee/byte. Transactions would then specify how and which outputs receive portions of [(TX_fee/TX_length - LIFB)*TX_length]. This change is desirable because it addresses the issue of miners prioritizing transactions with the highest fee/byte, leaving users who prefer lower fees at a disadvantage. Some users require quick confirmation times and are willing to pay higher fees, but still prefer to pay the LIFB fee/byte amount. Lower fees are important for transfer efficiency and make a money system more competitive.However, it is important to note that this proposed hard fork change is significant and may come with performance problems. Hard forks are generally challenging to implement, and if fees are already very small and there is minimal difference between a high priority fee/byte and the LIFB, the issue may not be significant. Despite these challenges, the proposal has been put forward, although it remains uncertain whether such a hard fork will ultimately be deemed worthwhile.
Updated on: 2023-08-01T20:06:38.037279+00:00