Bitcoiner in panic pays $70K BTC fees

An apparently panicked Bitcoiner paid nearly $0.75 BTC ($70.500) as a Replace-by-Fee transaction fee.

You can also find out more about the following: transaction The question was asked about an hour after midnight on the 8th of April. The second attempt was made to perform an RBF The transaction was changed to a new target address. It sent 0.48 BTC (37,770 USD) and 0.2 BTC change (16,357).

Anmol Jain of cryptoforensics company AMLBot told Cointelegraph the initial transaction included a “default or conservative” fee. First RBF increased the fee by nearly twice the amount, and also changed the address of the output.

The confirmation for both transactions will never arrive. This is because the much higher fee RBF transaction took its place with the same output as the second RBF transaction — presumably, an attempt to bump the fee to ensure that the RBF is processed rather than the original transaction.

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An apparent panic-induced mistake

This transaction shows signs of panic, as the user sends a second transaction quickly to avoid the first transaction being added into a block or becoming final. Jain proposed some explanations.

“Maybe he meant to use 30.5692 sat but, due to haste or butter fingers, ended up using 305,692 sat.”

A second RBF also adds an input unspent transaction output (UTXO). The UTXO in question contained almost 0.75 Bitcoin.BTC). It is likely that the user did not update their address when they changed it or misjudged how the transaction was structured.

Jain suggests that there is a possibility that the user was confused by the fee set in absolute terms versus the one in satoshis per virtual byte. Or that the automated script that processed the transaction had a bug. A wallet that allows setting fees in satoshis could create a situation where the amount charged is too small, leading to an incorrect fee, warnings about it, and overcorrection.

“System reads it as 30 sats total fee, which is way too low, so user types 305000 thinking it means 30.5 sat/vB, and the wallet actually applies 305,000 sats/vB, which is insane.”

Related: Bitcoin user pays $3.1M transaction fee for 139 BTC transfer

Replace-by-fee: a controversial feature

RBF has been widely misunderstood, and is controversial. Bitcoin transactions The results are still not final until the blocks are confirmed.

Transactions in the mempool are at the mercy of miners — who are expected to be profit-driven. Bitcoin developers predicted that if there were multiple Bitcoin transactions with conflicting fees, they would process the most expensive one.

It is not possible to stop Bitcoin miners simply from including the first transaction sent. Due to the nature of decentralization, it is difficult to determine which transaction came first. The RBF feature was created to recognize this and allows users the ability to change unconfirmed payments by sending an alternate transaction that has a higher fees.

Bitcoin Cash was the cause of some controversies.BCH) proponent Hayden Otto claiming that RBFs allowed for Bitcoin double-spends In 2019, we’ll be back. Bitcoin Cash, on the other hand, has removed this feature. It claims that all transactions made through its network will be final.

RBF-like transaction were still confirmed to occur occasionally on Bitcoin Cash, regardless of how blockchains work. RBF was formalized because it is an implicit property of the Bitcoin-like consensus mechanisms.

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