{"type":"rich","version":"1.0","author_name":"npub17ty4mumkv43w8wtt0xsz2jypck0gvw0j8xrcg6tpea25z2nh7meqf4qgyd","author_url":"https://nostr.ae/npub17ty4mumkv43w8wtt0xsz2jypck0gvw0j8xrcg6tpea25z2nh7meqf4qgyd","provider_name":"njump","provider_url":"https://nostr.ae","html":"📅 Original date posted:2015-02-12\n📝 Original message:\u003e\n\u003e So anyway, in my opinion, it is actually great that Bitcoin is still\n\u003e relatively small: we have an opportunity to analyze and improve things.\n\u003e But you seem to be hostile to people who do that (and who do not share\n\u003e your opinion), which is kinda uncool.\n\u003e\n\nTo clarify once more, I'm all for people researching and building ways to\nmake Bitcoin better and safer. And debating that here is cool too.\n\nThe \"replace by fee\" patches don't do this; as you said yourself the whole\nscorched earth thing makes no sense. It's not a solution to anything and\nit's important people realise that.\n\nPerhaps it will help if I spell out why this whole approach won't work (but\ncan easily damage bitcoin a lot along the way).\n\nNormal Bitcoin nodes pick which transaction to put into a block by simply\nselecting whichever they saw arrive first, as determined by the arrival\norder of network packets. This rule is simple and has multiple advantages\nfor people using Bitcoin to buy and sell things.\n\nReplace-by-fee changes this so nodes select whichever chain of unconfirmed\ntransactions pays the highest miner fees. Up until the point that a\ntransaction appears in a block, anyone can broadcast a double spend (or a\nspend of an unconfirmed transaction) which pays higher fees than before,\ncausing that tx chain to become the candidate for chain inclusion.\n\nPeter argues that this is stable and makes unconfirmed transactions safe\nbecause a fraudster can buy something, walk out of the shop, and broadcast\na double spend with a higher fee. But then the merchant can re-spend the\noriginal payment back to themselves with an *even* higher fee than that.\nThen the fraudster can re-spend their double spend with an *even* higher\nfee than that, and so on back and forth, until *all* the money has been\nspent to miner fees. Thus the merchant loses their goods but the fraudster\nhas still \"paid\" in some sense because they don't get the money either.\n\nThis argument makes no sense for two reasons.\n\nThe first is that this setup means miners can steal arbitrary payments if\nthey work together with the sender of the money. The model assumes this\ncollaboration won't happen, but it will. Because no existing wallet has a\n\"double spend this\" button, to make the scheme work the dishonest miners\nmust create and distribute such a wallet that implements the whole\nscorched-earth protocol. At that point it's easy for miners to reward the\npayment fraudster with some of the stolen money the merchant lost, meaning\nit now makes sense for the fraudster to always do this. The situation isn't\nstable at all.\n\nThe second is that it incentivises competitors to engage in payment fraud\nagainst each other. A big rich coffee shop chain that is facing competition\nfrom a small, scrappy newcomer can simply walk into the new shop and buy\nthings, then trigger the \"scorched earth\". Even with no miner\ncollaboration, this means the big company is down the cost of the product\n*but* so is the little company who lost everything. Whoever can outspend\nthe other wins.\n\n\nWe don't really need game theory to tell us that this plan is a bad idea.\nJust imagine trying to explain it to an actual shop keeper. They would\nthink you were crazy. Bitcoin is already a hard enough concept to\nunderstand without throwing into the mix \"anyone can burn the money they\ngave you after walking out of the shop\".\n-------------- next part --------------\nAn HTML attachment was scrubbed...\nURL: \u003chttp://lists.linuxfoundation.org/pipermail/bitcoin-dev/attachments/20150212/d71e96be/attachment.html\u003e"}