As of this weekend , GreenAddress is the first Bitcoin wallet to include a replace-by-fee option. With it, users can increase fees on their transactions with the click of a button–a feature welcomed by some, as it increases the likelihood a miner will include a transaction in a block. This can help transactions get “unstuck” in case of heavy transaction load, and benefits fee market dynamics. Others dispute the feature; critics fear that replace-by-fee could harm reliability of unconfirmed transactions, as payments can in some cases be reverted.
To test the feature, GreenAddress enabled a preview of the option on my own GreenAddress wallet several weeks ago. This, in turn, allowed me to test which parts of the broader Bitcoin ecosystem are ready for replace-by-fee – and which parts are not.
The results below are based on ad hoc experimentation from my own perspective as a user – not an official analysis conducted with scientific precision.
GreenAddress from the Sender’s Perspective
The first test, of course, was GreenAddress itself, from the sender’s perspective. (Tested on the Chrome extension version of the wallet.)
Since this weekend, the GreenAddress replace-by-fee option is switched on by default. (Users that don’t want to utilize the feature need to disable it in the “Settings” panel.) When switched on, each transaction sent from the wallet includes a replace-by-fee flag. This way, network nodes and miners know it’s eligible to be replaced by a conflicting transaction that includes a higher fee.
After sending my first replace-by-fee transaction, I was automatically redirected to the “Transactions” screen, where all past wallet-transactions are displayed. And, underneath the (still unconfirmed) replace-by-fee transaction, a new tab had appeared: “bump fee.”
While opt-in replace-by-fee as included in Bitcoin Core allows replacing any unconfirmed transaction (even if this means unconfirmed transactions are “canceled”), GreenAddress users can only resend […]
