A very controversial problem today in cryptocurrency is the idea of “blocksize”, which has become unaddressed in the field over the past year. With concern growing over blockchain inflation and how well this technology will be able to scale, cryptocurrency Emercoin has taken a proactive approach and has granted CoinTelegraph exclusive access to their solution.
Every cryptocurrency can only spend the entire Unspent Transaction Output (UTXO) when making a transaction. When a wallet contains many past transactions and needs to make a new outgoing transaction (payment), the wallet will select the best subset of suitable UTXO’s to generate the payment. A model of this creative logic is as follows:
Number of possible subsets is 2N, where N is the number of available UTXOs. Therefore, if the wallet contains more than ~20 UTXOs, it will be practically impossible to check all of them and find the optimal subset of UTXOs to use. The Current Solution
Bitcoin and many other cryptocurrency wallets use a stochastic approach for selecting an optimal subset of UTXOs. In this algorithm, the wallet performs 1000 attempts at random UTXO selections. A subset with a minimal amount is then used to fit the output transaction. Afterwards, a payment transaction is generated with 2 outputs: A payment output and a change output. The probability of finding the optimal solution where the sum of UTXO subsets exactly matches the output value is extremely low. EmercoinCT r: 131 has estimated the probability to look like (approximately formula):
(Nfit * Nattempts) / (2N).
Where:
N is the number of UTXOs,
Nfit is the number of possible optimal transactions (without change), Nattempts is 1000 for the current Bitcoin wallet code A More Efficient Solution Is Needed In the current implementation, there is a high probability that the optimal subset […]
