Topic: [Aug 2022] Mempool empty! Use this opportunity to Consolidate your small inputs! - page 5. (Read 83494 times)

To be honest I don't know how you can count them
At first I was no way in hell are 60 million possible in such short time, there is no capacity, ut looking at the ones before this

https://ordiscan.com/inscription/66035316
https://ordiscan.com/inscription/66035315
they exist, they are very small, and they got from 10 million to 66 million in a year, that's 154tx a day, with bitcoin averaging 500k , yup, possible..

But most are probably this kind of shit and not the ones I linked first, so 50bytes not 153kb.
Oh, and worth mentioning:
https://ordiscan.com/inscription/1
yup, such art, much taste, impressive design, much veneer of refinement.

Maybe this entity uses those 1000sat "dust inputs" on address 3Dc6zoToYwxxmBY9kcoLUrCMRjFx7ZpLky as some kind of status indication? I would assume that the consolidating transactions are prepared programmatically.

I tried to have a look into what happens with those 1000sat "dust" UTXOs for above address, but my own Electrum server (Fulcrum on a Raspi 4B 8GB RAM) struggles to deliver the transaction history for a watch-only wallet.

The coin traffic of involved addresses, looking past consolidation target address, is somewhat substantial.

I noticed this address: someone is consolidating many transactions with 1088 inputs (I guess to reach the maximum transaction size of 99.9 kB). Many of the inputs are very close to the same amount (0.00047477, 0.00047478, 0.00047479, 0.00047480, 0.00047481, ....). It looks like they're consolidating them starting from the largest inputs, and working their way down. At 11,549 transactions, it may have been millions of inputs already. They all have one large bc1-output, and all transactions send 1000 sats to an address starting with 3. I first thought that may be so they can use CPFP later, but RBF makes more sense. Why create dust while consolidating?

There are 66 million of those spam things?

You don't get art bruh:
https://ordiscan.com/inscription/66035317
It's not dust, it a black and white picture of a man looking at dust...

These things are again getting way too cheap for some to not do something really stupid and inscribe some huge ass pics, this way I doubt we're going to see 1 sat/vb, at 2 sat/vb it will take just $1000 to try and squeezer one of those huge ass runes that occupy a whole block or somebody wafting to live it's name in whole block in the blockchain forever, so probably 4-5 satoshi will be the best we can hope for the next months.

And as I type this, Friday evening and we have a spike to 35 sat, if somebody seeks consolidations maybe postpone it for late Sunday.

Spam intensifies:

People Someone still pays 0.007 BTC to turn their precious Bitcoin into dust. I still think it's just one person doing this madness. They used to pay much higher fees for this, so it looks like they backed it down a bit to stop fees from going up much more.

I've recently seen many consolidation transactions with 1000+ transactions, so it looks like my caution isn't needed.

Why not all at once? Is doing smaller chunks more likely to be accepted? or is it just not having all your eggs in one basket?

You assume that companies are always rational entities. I'm afraid they're not...

Before I opened this topic, it would have been dust:
If that happens again, you'll just have to wait it out.

As long as you're not in a hurry, that works. I'm still waiting for lower transaction fees myself.

Many companies overcharge their customers, but wasting money still costs them money.

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Consolidations are going to take a while. I noticed bc1qwkpdjeatdwrpv4vu4mj84ee6vkn96vdz2drfsn is filling many blocks consolidating 0.000049999 BTC inputs at 7.28 sat/vbyte. The transactions all have >1000 inputs, weigh about 75 kvbytes, and send 0.05 BTC. The address received 8.6 BTC in total, so that makes about 170 large consolidation transactions (assuming all inputs are the same size, it's hard to see that many inputs on a block explorer).
How did this address get all those inputs? It came from transactions like this one, which paid $20 at 199 sat/vbyte for something that looks like Ordinal dust spam. Maybe the 4999 sats were a payment for some "service" related to the Ordinals? I don't know, but someone no doubt earned a lot of money from this.

Exchanges tend to overcharge their customers, so it's not like they care about being thrifty.

Looking at my situation, I have a bunch of UTXOs that are .0004 BTC and up, so my fears of everything turning to dust are not as dire as I thought. I am thinking of holding out waiting for something like a fee rate of 6 sats and just get it done. There are 3 UTXOs that are below .0004, one is .00008, I'll make sure I don't burn it.

If you have to consolidate small inputs at higher fees, at least omit the inputs that aren't worth the fee. This transaction for instance paid 25.1 sat/vbyte for 698 multisig inputs. That's about 3250 sat per input. It includes inputs as low as 0.00001308 and 0.00001498 BTC, which at this fee adds a negative value to the transaction. They're literally burning money to remove money from their wallet.
Several other inputs pay a very high percentage of that input in fees. It would be much better to wait. I assume this is an exchange using an automated system, and it's amazing they still haven't figured out an algorithm that doesn't waste money (and block space). And at higher transaction fees, the amount of wasted inputs only goes up.

There is no "one answer" for this: it depends

If you're always using your largest input to make small payments, the other party knows you own that much Bitcoin. If you're okay with that, your largest input keeps getting smaller. If, in the future, you want to make a large payment, it's cheaper to have one large input than having to use several smaller ones.
I would use small inputs for small payments. If you have enough of them, you may be able to use one without creating any change at some point. Or, my other favourite: combine payments so you have no change left, for instance by topping op a VPN or hosting balance. That way you're effectively making the small dust someone else's problem.
At current fees, I wouldn't worry too much about using 2 inputs when making a transaction. It's not ideal, but the cost isn't that high either.

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Earlier today, fees were slowly dropping and months old consolidation transactions paying 7.05 sat/vbyte were getting confirmed. Mempool.space's Mempool Goggles was filled with nice consolidations cleaning up mempool. There were barely any "Data" transactions waiting.
Now, it looks completely different:

It's so obvious it's just one person doing this. Someone creates thousands upon thousands of BS transactions sending Bitcoin dust and pays millions upon millions of dollars in fees. Nobody in their right mind would do that if they don't earn more from it, so this can only mean someone is still earning shitloads of money from selling BS to gullible FOMO people.

Yeah, I plan on consolidating once fees are lower. Just thinking about ways to reduce the amount of potential dust.

Well, if you have many UTXO and also spend a lot, sooner or later you can easily end up with small inputs off this, so you still have to consolidate now ant then.
The strategy is not very bad, but not the best either. However, I feel that the problem of small inputs is coming more from how you earn/get to your custody those UTXO (so you may not be in real danger).

Since I have - now and then - to convert Bitcoin into fiat (sadly), one strategy I take is that when I have to spend I pick some 1-2 UTXO with the sum not that far from the amount I need, and the change I send to the centralized wallet that I use to convert to fiat (not nice, but meh).

While I am waiting for lower fees, I want to prevent having small UTXOs in the future.

I think the correct strategy is to always spend from the UTXO with the highest amount of bitcoin. Is there is a flaw in this strategy?

All my BTC is KYC.
I don't engage in any illegal activity.
I don't have enough BTC to worry about people knowing my balance (well below 1 BTC).

You're double counting block rewards. If you spend 0.2BTC per block to raise fees by 0.4 BTC per block, and mine 1 out of 3 blocks, you're losing 0.2BTC per block you mine.

Apart from the math, with different numbers this may work in the short-term. But in the long-term, if you're spending 0.2BTC per block on raising the fees, and your competitors spend 0.2BTC per block on buying new mining hardware, you're on the losing end.

Hmm, now that I look again, this is way weirder than at first, maybe the labels are wrong?
1Kr6QSydW9bFQG1mXiPNNu6WpJGmUa9i1g is labeled as Bitfinex
https://bitinfocharts.com/bitcoin/address/1Kr6QSydW9bFQG1mXiPNNu6WpJGmUa9i1g
3929qmbYYxAST12ceKRWKxcRFwXNnrXnfE
https://bitinfocharts.com/bitcoin/address/3929qmbYYxAST12ceKRWKxcRFwXNnrXnfE

I'm saying that because what they are doing is really strange, they have >20 000 transactions like that, and this looks more like an old tumbling mixing error than anything else and this has been going for 8 days, kind of impossible for an exchange not to see it.


That's the big IF Phil, because if the amount of tx you need to create and mine yourself is just too big compared to the natural activity you will end up mining your own fees and little else, losing 1 block of 8 sat/vb fees for 1/10 of a block of 10 sat/vb fees.
And right now, as we actually mine 8sat/vb there is no demand for that block space, all weeknd and stuff.

And your evidence to support this claim is... ?

First of all, let's define what it means to "raise the fees". A miner cannot force a user to raise their transaction fee. A miner can only express their disapproval by not mining transactions paying less than x sat/vb. But, this gives their competitors the option to earn those fees. And since Foundry controls 33% of the hashrate, then it is a matter of time until transactions paying less than x sat/vb are mined by the rest 66%.

Related topic: What happens if pools try to maximize fees by congesting the network?