From: ZmnSCPxj <ZmnSCPxj@protonmail•com>
To: John Carvalho <john@synonym•to>,
Bitcoin Protocol Discussion
<bitcoin-dev@lists•linuxfoundation.org>
Subject: Re: [bitcoin-dev] [Opt-in full-RBF] Zero-conf apps in immediate danger (angus)
Date: Mon, 12 Dec 2022 02:27:31 +0000 [thread overview]
Message-ID: <mbdvMAocVkRVOHgwFJQ6z9c0IY1GxfhPKrIhd4yFYsYed_-m_0AzoELUhbBNEN1HByblCPmZmWyQ5Ow5TtGIY036az6gbfYUnyPtO_SkI18=@protonmail.com> (raw)
In-Reply-To: <CAHTn92wri-edhivrtqZCoEzAPEmwZFap12mM4yzxgp77O-+JYA@mail.gmail.com>
Good morning John, et al,
> > As has been pointed out by may others before, full RBF is aligned with miner (and user) economic incentives
>
>
> This is a theory, not a fact. I can refute this theory by pointing out several aspects:
> 1. RBF is actually a fee-minimization feature that allows users to game the system to spend the *least* amount in fees that correlates to their time-preference. Miners earn less when fees can be minimized (obviously). This feature also comes at an expense (albeit small) to nodes providing replacement service and propagation.
It is helpful to remember that the fees are a price on confirmation.
And in economics, there is a "price theory":
* As price goes down, demand goes up.
* As price goes up, net-earning-per-unit goes up.
The combination of both forces causes a curve where *total* earnings vs price has a peak somewhere, an "optimum price", and that peak is *unlikely* to be at the maximum possible price you might deem reasonable.
And this optimum price may very well be *lower* than the prevailing market price of a good.
Thus, saying "RBF is actually a fee-minimization feature" neglects the economics of the situation.
If more people could use RBF onchain, more people would use Bitcoin and increase the value to miners.
Rather than a fee-minimization feature, RBF is really an optimization to *speed up* the discovery of the optimum price, and is thus desirable.
Unfortunately many 0-conf acceptors outright reject opt-in-RBF, despite the improved discovery of the optimum price, and thus there is a need for full-RBF to improve price discovery of blockspace when such acceptors are too prevalent.
Regards,
ZmnSCPxj
next prev parent reply other threads:[~2022-12-12 2:27 UTC|newest]
Thread overview: 6+ messages / expand[flat|nested] mbox.gz Atom feed top
[not found] <mailman.48662.1670246787.956.bitcoin-dev@lists.linuxfoundation.org>
2022-12-05 15:19 ` John Carvalho
2022-12-05 21:14 ` Erik Aronesty
2022-12-09 15:58 ` angus
2022-12-13 12:55 ` Anthony Towns
2022-12-12 2:27 ` ZmnSCPxj [this message]
2022-12-12 9:57 ` John Carvalho
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