Author

Topic: Altcoin that improves transaction speed (Read 759 times)

legendary
Activity: 1232
Merit: 1094
January 08, 2014, 05:27:19 AM
#2
   I was impressed when I first started making transactions how they register instantly on the blockchain. When I have transacted in person with people, I have always just clicked once and not waited for the transaction to be confirmed- so transactions are effectively instant for me, since an unconfirmed transaction that is on the blockchain is good enough for me.

The transaction isn't "in the blockchain" if it is unconfirmed.

An unconfirmed transactions pretty much means a transaction that everyone (probably) knows about.  Once all miners know about your transaction, it is (probably) safe.

Having said that, it really depends on how much is at stake.  The larger the amount, the more effort an attacker would be willing to spend to get the transaction reversed.

Also, at the moment, virtually all miners don't allow transaction replacement.  If you spend a coin, that transaction gets into all the miners' memory pools.  If later, a transaction arrives that re-spends that coin, then they reject it.

However, miners could look at the transaction and see that it pays a higher fee, so use the new one.  That way, if they find the next block, they get a higher fee.

The fact that miners don't do this means that they are doing good for the network at a cost to themselves.

It is probable that as fees increase relative to block reward that miners will eventually start including the higher fee paying transaction rather than the one they received first.

There is a thread about a paper where they did some testing.  They connected to (say) 50 nodes.  They broadcast the transaction on 25 of them and waited until at least 13 of the remaining 25 connections sent back the transaction.

I think it was a vending machine system. 

Once they received the transaction back on 13 of the 25 connections, without hearing about a double spend, they were confident that their transaction had flooded the network.

This system inherently assumes honest miners.  If a significant portion of the mining power is at pools that will do tx replacement based on fees, then the double spender can replace the transaction by re-spending it with slightly higher fees.

It then gets more complex after that.  More advanced miners might have inclusion calculations based on chains of transactions.

For example,

TX1) Client spends a 0.01 BTC coin (A) and gives it to merchant as a new coin (B) with 0.001 fee

Merchant provides goods

TX2) Client re-spends coin A back to himself as a new coin (C) with a 0.002 fee

Miners replace the first tx with the second, since they get more fees

TX3) Merchant responds by spending coin B and paying 0.01 (100%) in fees

TX3 is worth 0.01BTC, so it is a very valuable transaction to include, but it can only be included if TX1 is included.  If TX1 is not included, then coin B never exists as a valid coin.

The miner can either include TX1 and TX3 or the miner can include TX2.  The first option pays out more.

If the miner does include TX1 and TX3, then the miner gets the entire value of the transaction.  The advantage is that at least the double spender gets nothing.

If the double spender is a mining pool, then he has a chance of getting the higher fee though.
hero member
Activity: 728
Merit: 500
January 08, 2014, 01:31:38 AM
#1
   Since I've been into bitcoin, none of the altcoins has really convinced me as being anything more than a bitcoin spinoff. I haven't seen anything that offers any real improvements. Only two concepts have really gotten my attention as something that could potentially be a major improvement.

Worldcoin claims to have far better confirmed transaction speed, which I could see as being useful, since having to wait 15-45 minutes for confirmation or triple confirmation is a little inconvenient.

   I was impressed when I first started making transactions how they register instantly on the blockchain. When I have transacted in person with people, I have always just clicked once and not waited for the transaction to be confirmed- so transactions are effectively instant for me, since an unconfirmed transaction that is on the blockchain is good enough for me.

  Am I being too trusting? Is there any way to fake a transaction so that it shows up on the blockchain, never gets confirmed, and then disappears?

Also, I have heard talk of a coin that improves on bitcoins anonymity. Could this really be a major draw? I thought tumblers were enough to render coins anonymous. Is there anyone here who can explain this to me or can point me to a thread that has already discussed these issues?

    As far as I can tell, these are the only real viable altcoins that could feasibly cut into bitcoins market share, but if the improvements are not really improvements or could be rendered to bitcoin without necessitating new altcoins, could it be that all altcoins are at best gimmicks, and at worst pump and dump scams for people who either can't afford bitcoin mining hardware or feel like they missed the boat?
Jump to: