Scaling Bitcoin Workshop- On Wallets and Transaction Fees.

Scaling Bitcoin Workshop: On Wallets and Transaction Fees

Avatar newsbtc 4 years ago

The first phase of the Scaling Bitcoin workshop was held in Montreal from September 12-13. The event featured several presentations and academic papers from experts discussing the issues of scalability, block size limits, and many others.

Among the presentations made during the conference was on how bitcoin wallets can handle real transaction fees by speaker Bram Cohen. He is best known as the author of the peer-to-peer BitTorrent protocol, as well as the first file sharing program to use this protocol.

Issues on Scaling Bitcoin

Cohen began by specifying that the discussion is focused on consumer wallets without microchannels and that of transaction fees. Although the use of bitcoin promises zero to minimal transactions costs, he mentioned that these are typically determined by supply and demand.

He went on to explain how both supply and demand can be prone to fluctuations, which is often observed in cycles. He suggested that consumers who are patient enough to wait for demand to be much lower should be rewarded with lower transaction fees.

When it comes to applications on wallet interfaces, he suggested that a customer should have the option of setting a maximum transaction fee and how long he or she is willing to wait before it falls below that level. He also added that there should be a “failed to send” option when the transaction time limit expires. At the moment, these features are not available and he stressed the need to extend the protocol to accommodate these.

Some of the information that can be used to construct these features include data on past transactions, current transactions, and past transaction fees that customers have been willing to pay. In addition, data on how long payment attempts are being made can also be taken into account.

He went on to suggest transaction combinations that can be applied when fees are at a minimum in order to allow the network to process more entries. He explained that this extension could help a bit with size, as using Schnorr could allow the usage of a single signature with multiple inputs.

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