Topic: Should we promote acceptance of "zero-conf transactions"? (Read 322 times)

the obvious solution is an off-chain one. find an exchange (like bakkt or gemini) who can instantly deliver bitcoins through a custodial account on the back end. this is how the SPEDN app is set up: https://cointelegraph.com/news/flexa-launches-app-where-shoppers-can-spend-crypto-at-15-major-us-retailers

that seems like a more practical and safe solution than trying to gauge how many customers you might gain/lose by risking (or not risking) zero-confirmation bitcoin payments.

i think trusted off-chain intermediaries like that are the direction things are headed until decentralized and instant point-of-sale solutions built on lightning (or other layer 2 protocols) are viable at scale.

I think it all depends on the overall outcome. If with accepting zero-confirmation transactions you lose more to thieves than what you gain from additional customers, then you don't do that. But it's possible that your losses will be negligible compared to additional profit. In economic terms, I would compare accepting zero-conf transactions to installment selling. Yes, it's risky, but it turns out it's worth it.

There are different types of Bitcoin adoption. Those bemoaning the dearth of merchant adoption should know how reluctant people who already hold it are to spend it. And then when you have a world which is largely ignorant about Bitcoin at all it's no surprise it's not exactly a booming area. It's possible it will remain a relative niche even if BTC becomes a fixture worldwide for other reasons like saving. Why would you want spend it if you have depreciating alternatives?

The best choice for Bitcoin payments is to use the Lightning Network, not zero-conf transactions. Because the risk of
zero-conf transactions is quite large, I doubt if there are merchants who agree with zero-conf transactions, with the risk of
double spends. The problem is that there are still many merchants that don't use the Lightning Network. Makes the development
of Bitcoin adoption is not going well until now.

Bitcoin's core developers won't give a shit about this. They have more important things to ponder. Gmaxwell celebrated the moment fees approached the block reward briefly in 2017, more for the sign of future sustainability than rinsing faucet users I presume.

Nothing I've seen about LNs has indicated that it's anything other than an interesting experiment, but most of us are completely unused to watching open source development happening in real time. When we arrived at Bitcoin all the hard work had already been done. LNs may get there eventually.

The chances of this getting abuse is high so it won't work period. This sounds like you wanting the bank to trust you for your words, that you'll send them money you intend withdraw but first they should give you cash since there's lot of queue and you're not having the patience to wait. You might think the bank are at disadvantage since they're interested in satisfying their customers to bring about more customers (bitcoin adoption) they should bypass the procedure and take the words of their customers but that's an impossible request same with waiting zero confirmation to become a thing.

We just have to trust the developers working on improving the bitcoin blockchain as it's just a matter of time before they come out with something that'll do the trick. They introduced lighting network but I think it's too complicated to do the job.

it's probably less of a question of how many people are willing, and more a question of how much damage those few people can do. it boils down to loss prevention, and i am confident that not accepting zero-confirmation transactions is one of the best loss prevention decisions a company can make---especially if crypto payments become more popular.


that might apply to large scale thefts, but i don't think it applies to low value transactions. no retailer is going to the police over a $4 cup of coffee. that's a waste of time and money. it's more important for them to figure out how to prevent the $4 losses.

I presume it would fall under the same remit as a cheque bouncing or cancelling the cheque before it clears. You're obtaining by deception and knowingly buying things with money you don't have. Conventional law isn't going to be very impressed with that. No matter what you're paying with you're exchanging value and intentionally withholding your value.

I doubt any merchant would be willing to risk with zero-confirmation transaction. I mean someone might send a really low fee during the time when the network gets congested. Chances are the transaction will get dropped, or the user will double spend it! You will find some merchants where when you send above certain fee, your order gets processed (the fee depends on the network. If you pay the current average fee, they will process your transaction with zero conf).
I doubt any casino does that. What if someone makes a huge deposit, quickly does an all in x2. If he wins, he waits for the confirmation. If he loses he tries to double spend it. Too risky for a casino.

The advantage of doing this, will be immediately be cancelled when merchants starts losing money or when scammers start exploiting this. We want a flawless payment system, where people get what is paid and where you do not have to be worried about this.

If I have to pay $2 to $6 to transfer any amount of bitcoins to someone in another country, then I will settle for a few hours waiting for that transaction to be successful.

We are boasting about Bitcoin not having the same problems as credit cards, where transactions can be reversed, also called chargebacks. So let's settle for a more reliable and trusted payment option and sacrifice some speed and higher fees for that privilege. 

It will only do more damage to the merchants due to scam and for the bitcoin itself, so zero confirmation transactions should never be encouraged in the decentralized payment system.As other said lightning network can be useful for payment of small amount or better go with the zero transaction fee altcoins for such small amount of transfers.

Err. Good point. Idk, while there are no laws specifically concerning double spending, it's still the case that the buyer attempted to buy a product/service by taking back his payment and without ending up with the seller having the payment. So I guess it's technically theft? I don't know crap about law.

Fuck. Probably the same way how chargebacks work with a joint credit card account?

Even though the halving of the block reward had occurred recently, miners are still getting much more from the block reward than from all the fees combined. Look at some latest blocks, for example:

Block 643661


Block 643660


Block 643659


(Note that sometimes the Fee Reward exceeds 1 BTC, but this happens very rare.)

Besides, all fees will never be small. As it was proposed earlier in this thread by @kryptqnick, zero-conf transactions can be accepted for payments below $50, but people should pay higher fees when purchasing more expensive goods/services, or just transferring big amounts from one place to another, when they want it fast. So, the verifiers(miners) will be still incentivised. In the future, with more halvings, this situation can change, but actually it depends on the USD price of 1 BTC. It's possible that it will be so high that even 0.78125 BTC, the block reward we'll have after 2036, will be enough to incentivise hundreds thousands of miners.


Theoretically, yes, but in reality not many people want to engage in criminal activity. It is possible to buy a counterfeit 100 Dollar bill of very good quality for $40-$60, and use it in places where it can't be detected(there are plenty of them), but not many people are willing to do that.


Oh, c'mon, man! They confiscate your phone, computer, or whatever, and prove the guilt.

this is something i've always been curious about, and that we don't have legal precedent for. are we sure that double spending constitutes criminal fraud or a similar crime? this could make for a fascinating legal case.

the courts haven't established whether an unconfirmed bitcoin payment constitutes money received, in the same way cashing a check or taking possession of cash would. i know i don't personally consider money received until a transaction is confirmed on the blockchain.

on top of that, there is also plausible deniability re who sent the double spend transaction. since multiple people can have access to the same private keys, can it be proven beyond a reasonable doubt that you double spent?


they at least support withdrawals to bech32 addresses now and if you look at their hot wallet, they've started using them internally. indeed, they do not support segwit address generation though.

I don't think it is a welcome solution to a temporary problem that is only happening when there are massive spikes in the mempool. Several initiatives have already been put into place to address this issue that we are facing every time a massive price rise is happening. Though not everyone is into it, or like the ideas that were proposed, still one can't deny the fact that those remain useful if utilized and developed the right way, such as the lightning network. Zero-conf transactions being accepted puts us at a greater risk of countless double spends and merchants not receiving payments, instead of fixing the 'problem.' The intention is good, though, just that the solution proposed is not really effective and will do more harm than good.

Well I think the Lightning Network was built to solve that problem. The high bitcoin transaction fees is quite expected in future considering that the price will increase too much. The Lightning Network is the only possible solution to solve this problem as of now and I think it will.
Though I am not sure if the LN is stable right now, I think as people start using it regularly it will get more and more stable.

I agree that supporting zero confirmation transactions is a good solution. I've never seen a transaction not getting confirmed, and average people probably would not bother finding out how to abuse the system (especially in case of it being a crime and people being actually punished for committing it). Besides, it's not hard for merchants to minimize the risk by putting a limit. I mean, say, zero-conf transactions for payments up to $50 and 1 confirmation for more expensive purchases.
This all might not work, but it's worth some research to determine how often people would abuse it on average.
As for the LN, there are groups of people who'll never use it (and they might be the majority given the popularity of the LN), and I don't think a controversial thing like that could go mainstream.

I definitely don't disagree; but the incentive of people attempting a double-spend would greatly drop(in my opinion) if the transaction is done in person(hence I chose the coffee example). Attempting to double spend to get back $4-5 while risking jail time due to your identity being exposed(assuming the shop has a CCTV camera) isn't simply worth it in my opinion. But idk, there are a lot of a-holes out there so I definitely could be wrong. 🤷‍♂️

True, and it's definitely frustrating. Binance, one of the biggest exchanges, doesn't even have SegWit.

And a few other services, like I've seen ad packages and minor buys, they are accepted and good enough for bookings but delivery only on confirmation. Same as gambling sites, free to use your account balance that updates as soon as txs are detected but you won't be able to withdraw anything until input confirms.

That said, also seen more sites require 1 confirmation because of double spend headaches.

On the other hand, sites requiring what used to be the standard 6 are now lowering to 2 or even 1.

I always accept unconfirmed when from a repeat user I know and trust. Maybe sites can implement a sort of trust setting that increased with time and deposit frequency and volume. The more trusted you are the closer to 0 confirmation or even higher percentages of "unlocked" balance from 0 confirms.

Or people will be pushed to go LN (that somewhat takes care of trust at 2nd layer?).

imagine being able to easily double spend every low value transaction back to yourself. you don't think anyone would take advantage?

if it can be exploited, it will be.


lightning adoption is sadly moving at a glacial pace. the liquidity just isn't there, and won't be for quite a while.

what i'd really like to see is boring stuff---transaction optimization, fee optimization, segwit support, batching. it's not glamorous, but if exchanges would just stop unnecessarily clogging the network, i think it would buy us considerable time re scaling.

Zero-fee transactions belong to past story and nowadays, it rarely happens and only happen if you have miner friends. So most of times, it comes from mining pool owners. The fall or nearly disappearance of zero-fee transactions is a proof of better bitcoin adoption.
It is not a full list but you see some examples on who are miners of zero-fee transactions.

In last 24 hours, there are opportunities to move bitcoin at 1 - 2 satoshis/ (v)byte. 8 - 9 hours ago, mempool was clear again in last few days.
With Lightning network, you can but the problem is adoption of lightning network.
I don't think so. A better stable fee is enough to increase adoption besides better knowledge on how bitcoin transaction works & how transactions get confirmations.

Which one? All the ones I play on require at least 1 confirmation.

Right now, Lightning Network is the only way to promotes BTC payments with lower transaction fees. Unless the exchanges we used is partnered with the stores we always wanted to go. Like we what we have with our local exchanges. Like for example shopee is somehow partnered with coins.ph where when buy things there you don't have to worry about the extra charges the rate is always 1:1 when shopping there. It's the same with some online game stores. If the other stores are likethis, then promoting it to others would have been easy for us.

Even if we get used to it, it would be procrastinating our problems rather than solving it. It could turn into a growing trouble. I'd rather use bitcoin as it is than to use it for paying my taxi or coffee. There are things like lightning project that are trying to achieve the same though freezing some coins and issuing equivalent digital tokens. Other wrapped bitcoin solutions are also getting popular which are a better take to that solution.

Its not going to happen, at least not with people you don't implicitly trust in the first place. The danger of double spending isn't worth it. Indeed LN could be a solution, or simply pay in advance, sort of opening a credit/tab with the merchant/shop whatever.

I don't agree with promoting these as it will encourage scammers and people will blame it on Bitcoin.

Thought about this in the past, and I somewhat agree, as long as the fee is low but still passable(e.g. 5 sats/b). Of course though, this is for cheap merchant transactions like a $4 coffee and such(who the heck would double spend $4?). For bigger transactions like in restaurants, of course merchants wouldn't want risking the loss of $30+ unless probably they have your identity.

I don't think we get to use this kind of "acceptance" though; Lightning is a lot better now compared to when I initially thought of this as a solution. Phoenix Wallet is great! https://bitcointalksearch.org/topic/opinions-on-phoenix-wallet-5250677

Interesting topic though. +1

it's too dangerous, unless the transaction is non-RBF and has an extremely high fee well beyond what is reasonably required for reliable confirmation. otherwise the chances of double spending or the network not confirming the transaction are too high.

instead of seeking out instant or nearly instant transactions (high fee, next block confirmation), i think consumers should aim for eg 1-hour confirmation. get used to the idea of waiting for settlement. when everyone is racing to get into the next block, it really drives up the fee market in an exponential way.


with bitcoin's electronic and cross-border nature, i don't think those guarantees are good enough.

bitrefill was one of the only companies accepting zero-confirmation transactions. they recently stopped.

I do agree with you on the fact that the fee should not be set at zero.
I do know one thing :

Since Bitcoins is not centralized and there are numerous small miners working ... Their own income is dependent on the fee that we pay for the transactions.

We cannot get it done securely for free , even if we talk about lightning network:
-It did not demand zero fee but fee was exceptionally low
-Its not safe.

_*_


For sure lightning network is equipped to handle fast transactions but before going on any conclusions we should always remember how it's not safe and therefore I do believe we still have some years left before we can actually have a safer version of it.

_*_

I do believe we should have a upgradation where we cannot cancel the transaction , the ones which are made for any business reason , like: coffee and the person paying and one paid to , should receive a digital receipt of some kind.

Maybe smart contracts can be upgraded and then made into a more simpler version? Since this would not only be easy but also use but also enable some next level security  but then again we have to fight against Centralization amongst all of this.

But more than that am scared about how some people would use these unconfirmed transactions being accepted. For sure some hackers might find a way.

As far as I know, only gambling sites are accepting "zero-conf transactions".

However, if this is going to be accepted universally, we all very familiar with double spend and this will open a pandora's box, just saying.

No. If merchant allows it then the risk of double-spending or accepting bitcoin when the rate changes drastically is higher. Nobody is going to love that. As mentioned earlier, promoting LN is a better idea. While the setup is not as easy as it sounds, I believe it is justified if you want fast but secure (at least to some extent) transactions.

I guess zero confirmation means no verification by "verifiers".
What are the disadvantages of that^(no verification of transactions)? Is it worth the risk? How do you prevent/punish things like doublespending & other abuse that mostly occur due lack of verification or lack of proper verification? I think it's better to prevent abuses with a more robust decentralized/verification system.
I think if you have a different reward model that sufficiently incentive verifiers for their hard work, tiny/small fees and fast confirmation wouldn't be a problem. But you'll need to build something more advanced and well built to make this possible, efficient, easy, sustainable etc

One of the solution to reducing transaction fee is the lightning network, but many people are not using it for now because it is still under development, if fully developed, it can be used for cheap payments like paying for coffee etc. These should even be the main purpose of lightning network (to make payment of small amount of bitcoin)

Another is the use of segwit (bech32) addresses, with the use of such address and sending to such address, transactions fee is reduced in relation to the transaction weight. But this may not be satisfying enough.

There could also be other development in the future that can be used to reduce the transaction fee.

If I were a regular acceptee it's not something I'd encourage or put up with.

Going forward there'll no doubt be phases where low fee transactions will never go through in time and the more people there are the more attempts there'll be to cheat others. I'd expect many people who would never take the piss in real life would be inclined to give it a try on the internet.

Instead of exposing myself to that I'd be looking to accept other shitcoins and stuff like Coinbase internal wallet transfers.

Bitcoin adoption could start growing exponentially once people realized that BTC can be used as money in any place. Right now this is not the case because you either have to pay a pretty high transaction fee, from $2 to $6, or you should wait for a long time for your transaction to be confirmed. That's what most people think, and what is more important, that's what merchants think, refusing to accept payments in BTC.

I think the solution lies in accepting the so called "zero-conf transactions", only the fee, of course, should not be set at zero. Right now, for example(and keep in mind that this is not an advantageous period for such an example), you can pay as little as 2 satoshis/byte for your transaction to be confirmed within 3-4 hours. It means 672 sats, or $0.076, for the median transaction size of 224 bytes.

Will some people try to abuse it? Surely. But with the due process of law, they will be treated as counterfeiters, with all the consequences. So, the vast majority of people will not even think of trying to double spend, just like not many of us think of robbing a bank or counterfeiting money.

Thus, the proverbial "you can't pay for a cup of coffee with Bitcoin" will become obsolete. Anyone can afford spending extra 8 cents, and no one would risk their freedom for trying to steal a cup of coffee.

Please, share your thoughts on this.

TL;DR: I think the key to wider BTC adoption is in accepting zero-conf transactions.