Replacing Bitcoin Transactions: Community Responses to Opt-In Replace-By-Fee

By April 7, 2016Bitcoin Business

A new addition to Bitcoin Core called Opt-In Replace-by-Fee allows transactions to be flagged as replaceable, and actually replaced, until the transaction gets confirmed in the next block.

Opt-In RBF is a change to the memory pool and network relay code and gives wallets the option to add a signal to transactions that gives permission for full nodes to update the particular transaction. Bitcoin creator Satoshi Nakamoto introduced transaction replacement in his initial release of the Bitcoin Software, but removed it due to denial of service problems, which opt-in RBF solves by adding a higher fee for transaction replacement.

It is a slight variation of Replace-by-Fee, another feature included in Bitcoin Core. A full analysis of RBF, written by Aaron Van Wirdum can be found here .

Peter Todd, a Bitcoin Core developer who worked on the opt-in RBF project, publicly expressed concern in a blog post that opt-in RBF wallets are not yet ready to implement detection software for opt-in RBF transactions. He wrote that wallets without this software implemented leave users at a greater risk of being cheated by double-spenders, especially for zero-confirmation transaction (zero-confs). This can lead people to believe that the community should wait to integrate opt-in RBF.

Todd also admits that this is only a valid concern if merchants and consumer wallets were able to warn users of potential double-spend attempts before the integration of opt-in RBF. If wallets are currently unable to properly detect and warn their users, scammers would have no need to use opt-in RBF, as they would have no problem using the existing system.

Todd actually tested the current level of security of popular user wallets against double-spends attacks and posted his findings in a list, as seen below.

> Wallets not only failed to warn users that a double-spend might happen, the majority even […]

Leave a Reply

All Today's Crypto News In One Place