Speed up confirmation time - page 2.

mtomcdev

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Quote from: BurtW on July 28, 2014, 07:17:54 PM

What you may be talking about is the possibility of accepting transactions as "pretty much valid" before the first confirmation since as Danny said the confirmation time cannot be changed. This is called accepting a transaction with zero confirmations.

There are ideas floating around for this. One example is that a third party would insure the transaction after a small amount of time but before the first confirmation. If the transaction turned out to be bad and you did not get your BTC then the third party insurance would pay you the BTC you lost due to the fact the transaction never confirmed. There would be a fee for this insurance and the better insurance companies would have methods to reduce their claims by studying the transaction to make sure it has a very good chance of getting confirmed.

Is that along the lines of what you are talking about?

Yes, absolutely I was talking about that, and as Danny has pointed out I misunderstood what confirmation means in this context. More precisely, I understood that the confirmation is possible only in after 10 minutes as the transaction must be included in a new block, so I should talk about speeding up transaction acceptance instead of speeding up confirmation.

Thanks for the replies, all of you provided me with really useful info. Probably I should not make any comments when experienced hero members having brain storming about possible solutions, but I think both the insurance and centralized multi signature based solution could work. I think we all subscribed to the core concept of decentralization, but there are use cases when a centralized multi signature centralized wallet is perfectly acceptable. I think majority of bitcoin transactions aren't darknet related, most of the users wouldn't mind to compromise on decentralization and having a centralized multi signature wallet in order to be able perform quick transactions.

e4xit

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If the funds are sent from multi-sig inputs, one of which is a third party, then you can be *reasonably* sure that the level of collusion required to try and doublespend would probably not be worth it for low value transactions.

For example, there is a wallet provider called Greenaddress.it who deal in multi-sig. When I send you a payment from my wallet there both they and I must sign the tx. If I can see that the payment has originated from a (or specifically a Greedaddress.it) multi-sig address (and has a fee attached) I can be very sure that the chance of doublespend is low, i.e. I can accept zero confirmation payments with more security, no confirmation time speedup required.

Of course this is a degree of centralisation, and the merchant still requires myself and Greenaddress not to collude against them, but it is risk reduction.

This can be done without multisig too, I believe that Mycelium (android) wallet has a feature which checks recieved payments for a) a fee and b) propagation across the bitcoin network. if both of these are detected, the payment is labelled as 99% safe, even with 0 confirmations.
[Note, I have never used Mycelium wallet so my description might be a bit off]

Mitchell

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Quote from: BurtW on July 28, 2014, 07:36:19 PM

True again. So, best to wait for one or more confirmations unless you are willing to lose a certain amount of BTC to fraud.

I bet that Satoshi broke his brain over this issue and I doubt that we can find a better (better being faster, safer and fair) solution any time soon.

Quote from: BurtW on July 28, 2014, 07:36:19 PM

This actually may make sense in for example a coffee shop scenario. Most people would pay for their coffee and the transaction would eventually confirm. If only a very small percentage of people rip you off then your losses may still be less than losses and fees on conventional credit cards - so still a win overall even accepting zero confirmation BTC transactions.

This is the main reason why I don't see a problem in doing small transactions with Bitcoin. Even though I don't get why one would use Bitcoin in such a fashion, but that is my personal opinion.

BurtW

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All paid signature campaigns should be banned.

True again. So, best to wait for one or more confirmations unless you are willing to lose a certain amount of BTC to fraud.

This actually may make sense in for example a coffee shop scenario. Most people would pay for their coffee and the transaction would eventually confirm. If only a very small percentage of people rip you off then your losses may still be less than losses and fees on conventional credit cards - so still a win overall even accepting zero confirmation BTC transactions.

Mitchell

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Quote from: BurtW on July 28, 2014, 07:29:36 PM

Another idea that has been talked about is that if your BTC are coming from a well known trusted source like ~~Mt. Gox~~ ~~inputs.io~~ well some sort of trusted large node then you are safe in accepting them with zero confirmation. This hightly trusted source of BTC would publish the fact that BTC coming from a certain address or set of addresses will all be good so you can trust the transaction without waiting for a confirmation. Perhaps they back their claims with some sort of insurance/garantee.

Well, if people decided to trust that one node, wouldn't those people be vulnerable to shady practices by the node owner?

BurtW

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All paid signature campaigns should be banned.

Point taken.

Another idea that has been talked about is that if your BTC are coming from a well known trusted source like ~~Mt. Gox~~ ~~inputs.io~~ well some sort of trusted large node then you are safe in accepting them with zero confirmation. This hightly trusted source of BTC would publish the fact that BTC coming from a certain address or set of addresses will all be good so you can trust the transaction without waiting for a confirmation. Perhaps they back their claims with some sort of insurance/guarantee.

Mitchell

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Quote from: BurtW on July 28, 2014, 07:25:38 PM

A bad transaction is a claim on the insurance. Nothing they can do but to pay the claim, possibly learn from the experience, and move on. There is nothing they can do if a transaction that they thought was good turned out to be bad - probably because it was a double spend.

Hmhm, well it's a very interesting idea and I would love to see it happen. However you would need to trust that party to be fair and honest, which could be a problem.

BurtW

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All paid signature campaigns should be banned.

A bad transaction is a claim on the insurance. Nothing they can do but to pay the claim, possibly learn from the experience, and move on. There is nothing they can do if a transaction that they thought was good turned out to be bad - probably because it was a double spend.

Mitchell

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Quote from: BurtW on July 28, 2014, 07:17:54 PM

What you may be talking about is the possibility of accepting transactions as "pretty much valid" before the first confirmation since as Danny said the confirmation time cannot be changed. This is called accepting a transaction with zero confirmations.

There are ideas floating around for this. One example is that a third party would insure the transaction after a small amount of time but before the first confirmation. If the transaction turned out to be bad and you did not get your BTC then the third party insurance would pay you the BTC you lost due to the fact the transaction never confirmed. There would be a fee for this insurance and the better insurance companies would have methods to reduce their claims by studying the transaction to make sure it has a very good chance of getting confirmed.

Is that along the lines of what you are talking about?

That is pretty neat idea to be honest. Would love to see something like that being made and I would be very interested in their way of handling "bad" transactions.

BurtW

legendary

Activity: 2646

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All paid signature campaigns should be banned.

What you may be talking about is the possibility of accepting transactions as "pretty much valid" before the first confirmation since as Danny said the confirmation time cannot be changed. This is called accepting a transaction with zero confirmations.

There are ideas floating around for this. One example is that a third party would insure the transaction after a small amount of time but before the first confirmation. If the transaction turned out to be bad and you did not get your BTC then the third party insurance would pay you the BTC you lost due to the fact the transaction never confirmed. There would be a fee for this insurance and the better insurance companies would have methods to reduce their claims by studying the transaction to make sure it has a very good chance of getting confirmed.

Is that along the lines of what you are talking about?

DannyHamilton

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You appear to have misunderstood something.

Confirmation time in bitcoin is random with an average of a bit less than 10 minutes.

By paying a transaction fee you can increase the probability that your transaction will be included in the next block, but there is nothing you can do to make that block show up any faster.

mtomcdev

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I read a few discussions in this forum when experienced devs and community members said that there are ways and even services built on the Bitcoin network to speed up the confirmation time. Someone said that even instant confirmation is possible using some kind of trusted node or some other mechanism. I read those comments but never came cross with the specifics, so I am not sure what are the options and methods to speed up the confirmation time (if any).
Would you let me know please how the Bitcoin confirmation time could be speed up (even with a third party service) and if that is possible at all?

Topic: Speed up confirmation time - page 2. (Read 2826 times)