Topic: [Aug 2022] Mempool empty! Use this opportunity to Consolidate your small inputs! - page 39. (Read 88307 times)

It has occurred to me that something else can be done as well. Simply wait to consolidate, for example, to the 8-10 legacy inputs that poyaa87 said, and if I have to make a transaction, use coin control and use the large input. At the slightest hint of rising fees, consolidate, but just the small inputs just in case the transaction gets stuck in the mempool. If I have to spend, use the large input. Even if it would take too long to confirm the transaction to consolidate, I wouldn't care, because I could keep spending. I think that when the mempool was fuller I waited about a month. In this case I would not consolidate all the inputs, as I would finally have 2 inputs, the large original one and the second with an origin of 8-10 small inputs consolidated into one. I wouldn't have all the inputs consolidated into just one but I would save on fees as well.

I don't know if I am making myself clear, and what do you think, because little by little I am learning but I still have a lot to know.

This assumes your spending won't change in the future, while some things are out of your control. I remember paying about 0.001 BTC for a small transaction (1 input, 1 output) at the end of 2017. If fees get that high again, you'll lose half of your 0.002 BTC and might want to adjust your spending habits. If you have bigger inputs, you could for instance open a large LN-channel or deposit a larger amount at once. Spending 0.000002 BTC per input now could save you 0.001 BTC per input later. I'd say that's a small price to pay for flexibility.

The number of unspent outputs you have should not be considered when deciding if you want to consolidate. You should consider:

• the value of your unspent outputs
• how high you anticipate transaction fees being when you need to spend your unspent outputs
• the value of the transactions you anticipate spending when fees are higher (including the cost of the tx fee)

For example, if you have a bunch of unspent outputs valued at 0.002, but never anticipate spending more than 0.001 in a single transaction (inclusive of anticipated fees), you should not consolidate any of your unspent outputs, and should not consolidate anything until you have unspent outputs totaling 0.001 (including tx fees to consolidate), but once you have enough to consolidate into at least 0.001, you should not consolidate additional unspent outputs, unless you have enough to consolidate into an additional multiple of 0.001, in which case your new outputs will each be 0.001.

If you anticipate spending varying amounts, you can use a similar principle. For example, if for every three 0.002 transactions you will have, you will have one transaction valued at 0.005, you can consolidate into new outputs valued at 0.002 three times and 0.005 one time (in any order).

When deciding if it is economical to consolidate, you should add the cost to create a consolidation transaction to the cost of a transaction with one input and one output (plus change if applicable) at the fee rate you believe fees will rise to when you have to actually spend your coin. You should compare this cost to the cost of creating a transaction with however many inputs you are consolidating, and one output (plus change, if applicable). If consolidating results in a lower total fee paid, you should consolidate, otherwise, you should not.

The above ignores any privacy implications to consolidating, which you should also consider. 

Also, of course, consider the amounts.

Having multiples of around 0.01 BTC in each address with only a few inputs per address is fine unless you suddenly want to cash out of Bitcoin forever or buy a Ferrari.
Maybe just keep updating the receiving address at your BTC source every so often, depending on the size of each input and how many inputs that represents.

Of course if you are receiving lots of tiny inputs (less than about $100 at the current price) then consolidating with low fees is pretty much mandatory.

No. It depends: if a small amount arrives in my wallet, I sometimes consolidate it instantly, and sometimes just let it be. I also receive weekly payments to a cold wallet. I've consolidated those a few times (at fees higher than the current fees), but it's a lot of work to reboot into offline mode to sign the transaction. So I don't do it very often.

You can still do it when fees are 1 sat/byte. But as long as fees stay this low, waiting a week saves you a few sats. If you need the funds soon and expect fees to go up, then weekly consolidations at 1 sat/byte would be a good choice.

Inputs are larger than outputs, so consolidating 2 legacy inputs 4 times costs 4 times 340 bytes (1360), while doing it all at once takes only 784 bytes. It's always a trade off between saving bytes on transactions and future fee expectations. And at the moment you know for sure fees can't get any lower, so it can't get any better.

I was looking for something like that as a rule of thumb, thanks. Although I will continue to follow this thread and watch how the mempool goes.


I think I have just one input now, as I said above. I consolidated inputs recently. But I think pooya87's advice is what I was looking for.

It really depends on how large the amounts are in your wallet (i.e. dust or bags?)  It also depends greatly on what you want to do with the funds - buy one big ticket item, or a few smaller items.

Specifically, if you want to buy an item that requires two or three of your deposits, ask yourself if you want to consolidate all transactions at the same time (and probably move to new wallet addresses while you are at it), or just pay the bare minimum and pay for the item and have one even smaller transaction in your wallet.

You want to let the UTXOs accumulate a little in your wallet before you consolidate them and certainly not right after you receive your payment each time (that would mean consolidating 2 UTXOs). I'd say 4-5 for legacy inputs and 8-10 for SegWit inputs is a good number.
As for fee speculation, it is harder than price speculation because it is affected by big price movements among other things (such as hashrate drops, spam attacks, empty blocks being mined, etc) and none of them are easy to predict.

Do you have any rule of thumb to know when to consolidate?

Let me explain. Until now I was in a signature campaign that paid me every six or eight weeks but with a payment for each week. In other words, after two months I received 8 payments, or inputs, of about $40 and I consolidated them immediately, especially because the mempool has been empty recently. Now I will receive weekly payments and I doubt until when to wait to consolidate. I suppose consolidating every week would be silly as LoyceV in the OP talks about "many small inputs".

Should I wait until I have 8-10 inputs? If I wait that long maybe the fees have skyrocketed.

Changes in difficulty should not affect the mempool when it is for all intents and purposes, empty. This is especially true when describing situations in which the difficulty will increase. This might not be the case if the difficulty was dropping by a substantial amount, but that is not the case.

thanks for the advice.  i never thought abut doing this before.  worked out well.

So far the price is rising very slowly despite having a couple of spikes, this I believe is the main reason why there hasn't been any overly excited mempool spam by the traders yet. We may start seeing spikes when price breaks $50k and the rise speeds up though. But that may not happen this week.

As of now 11AM EST on 14-Aug-2021 the mempool is empty.
Unless something changes with the usual weekend coin movement it should be mostly empty for the next 40 hours or so.

As for the difficulty, it's at the same level it was in June of last year with the next change coming in about 12 days.

Most people expect a slow climb back to where we were. But it's all a guess, depending on when and when the miners find new homes.
And what they actually are mining, there seem to be miners slowing being shipped to end users and while we ASSUME most of them are going to be mining BTC there are a bunch of other SHA coins out there that they may wind up being pointed to. But the difficulty discussion is really for another thread unless it starts to cause enough of a slowdown to effect the mempool again.

-Dave

Mempool is starting to grow again. It looks like the difficulty went up, so next Sunday might very well be the last chance in a while for low fees.

This is exactly the reason I use instant exchangers instead of "normal" exchanges. Withdrawal fees are 0.001 BTC on many sites (and 0.0005 on some). That's a lot if you're withdrawing only a small amount, but unfortunately the large exchanges don't seem to want to compete on this.

Indeed, it can make "smaller" customers happy(er). And those are in greater numbers and will spread the word about the service.

Just somehow I feel that the agenda of big centralized exchanges is more on keeping customers' funds in their own cold storage instead of helping the customers withdraw cheaper...

Of course tools like this site are mainly for "advanced" users and it is always best for others to choose a decent wallet with a good fee estimator and stick to that or at least use this alongside that wallet.

Sometimes there are services that "burst pay" their users. For example I remember freebitco.in paid on weekends, so basically we saw lots of transactions go out at once which means most of them would be in the same block. Of course that is the case with payments not spam attacks.

It should be quite simple to implement:

When your site has withdrawals, and, for example a user wants to withdraw 1 BTC, he sees a couple of options on the screen:

1. Withdraw 1 BTC fast, usually 10 to 20 minutes, withdrawal fee is 0.02 BTC
2. Withdraw 1 BTC with batching, can take up to an hour, withdrawal fee is 0.001 BTC

That's just an example. At least you give the user a choice. Some people don't mind and can wait the extra hour or two, and pay less.

I think that's good for business. I ran a bitcoin "gaming" website before.

From a business point of view, I do not really understand why to spend time and effort on this if the transaction costs are covered by clients in one way or another. But such a decision would be very clever from a marketing point of view, since by spending a little money on updating and implementing this feature, you subconsciously convey to customers the idea that transaction costs on your platform are lower than on competitors' platforms, (even if the client never uses this function + you offer what your competitors do not offer.).

If you are one entity and need that many transactions, it may make more sense to combine the transactions into one... also called batching. Don't do 50 or 100 separate single transactions, do 1 transaction with 50 to 100 inputs/outputs as needed, wait a few minutes to accumulate a bunch, ask the user if they are willing to wait to pay a lower fee.