Re: [bitcoin-dev] Transaction Merging (bip125 relaxation)

From: Rhavar <rhavar@protonmail•com>
To: Alan Evans <thealanevans@gmail•com>
Cc: Bitcoin Protocol Discussion <bitcoin-dev@lists•linuxfoundation.org>
Subject: Re: [bitcoin-dev] Transaction Merging (bip125 relaxation)
Date: Mon, 22 Jan 2018 13:18:14 -0500	[thread overview]
Message-ID: <vdr3w_poTPTx_YFFvEdLugS0a_wbKTRx00npKupZqVNWPO0lwxIEMxMaC9xyPSGNmtuRn2behoLMq4iR0YTwDoQxR6AZds8HA-RccVr_ZPw=@protonmail.com> (raw)
In-Reply-To: <CALPhJazXpUAsd9qeHPZdwK6eeoEfsM7i3FouMifkKNv9YFzQ9w@mail.gmail.com>

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> If you spent your change from transaction A, that would be safe. There'd be no way you John could end up with 2 BTC from you then.

Yes, that's what the following paragraph says -- along with it's limitations =)

-Ryan

-------- Original Message --------
On January 22, 2018 1:16 PM, Alan Evans <thealanevans@gmail•com> wrote:

>> So now I still owe John 1 BTC, however it's not immediately clear if it's safe to send to him
>
> If you spent your change from transaction A, that would be safe. There'd be no way you John could end up with 2 BTC from you then.
>
> On Mon, Jan 22, 2018 at 1:40 PM, Rhavar via bitcoin-dev <bitcoin-dev@lists•linuxfoundation.org> wrote:
>
>> So my half-baked idea is very simple:
>>
>> Allow users to merge multiple unconfirmed transactions, stripping extraneous inputs and change as they go.
>>
>> This is currently not possible because of the bip125 rule:
>> "The replacement transaction pays an absolute fee of at least the sum paid by the original transactions."
>>
>> Because the size of the merged transaction is smaller than the original transactions, unless there is a considerable feerate bump, this rule isn't possible to observe.
>>
>> I my question is: is it possible or reasonable to relax this rule? If this rule was removed in its entirety, does it introduce any DoS vectors? Or can it be changed to allow my use-case?
>>
>> ---
>> Full backstory: I have been trying to use bip125 (Opt-in Full Replace-by-Fee) to do "transaction merging" on the fly. Let's say that I owe John 1 bitcoin, and have promised to pay him immediately: Instead of creating a whole new transaction if I have an in-flight (unconfirmed) transaction, I can follow the rules of bip125 to create a replacement that accomplishes this goal.
>>
>> From a "coin selection" point of view, this was significantly easier than
>> I had anticipated. I was able to encode the rules in my linear model and
>> feed in all my unspent and in-flight transactions and it can solve it without difficulty.
>>
>> However, the real problem is tracking the mess. Consider this sequence of events:
>> 1) I have unconfirmed transaction A
>> 2) I replace it with B, which pays John 1 BTC
>> 3) Transaction A gets confirmed
>>
>> So now I still owe John 1 BTC, however it's not immediately clear if
>> it's safe to send to him without waiting $n transactions. However even
>> for a small $n, this breaks my promise to pay him immediately.
>>
>> One possible solution is to only consider a transaction "replaceable" if it has change, so if the original transaction confirms -- payments can immediately be made that source the change, and provide safety in a reorg.
>>
>> However, this will only work <50% of the time for me (most transactions
>> don't have change) and opens a pandora's box of complexity.
>>
>> There's a few other hacks you can do to make it work in a few more cases, but nothing that is realistic to expect anyone to implement any time soon.
>>
>> However, if there was a straight foward way to merge N unconfirmed transactions, it would be easy get into production, and potentially offer some pretty nice savings for everyone.
>>
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