Several miners in OCEAN have begun utilizing the Coin Age Priority algorithm while constructing block templates with DATUM. Initially, Bitcoin Core relied on transaction order in mempool, but later shifted to prioritize older coins, ones that have remained unspent for longer duration. Although this approach was only used for a small part of blockspace and was eventually phased out around the time of Segwit, it remains in Bitcoin Knots.
While I can only speculate on the miners’ motives, considering OCEAN’s stance, it likely involves prioritizing “financial” transactions over others. Whether to assist small value UTXO owners or not, the decision seems to lack rationality.
Miners have the flexibility to structure blockspace and arrange transaction order within it, but it doesn’t change the fact that blockspace is interchangeable and valued on an open market. Deviating from fee rate-based transaction selection means potential revenue loss. The only exception would be if the alternate criteria were identical to fee rate selection, rendering it meaningless.
Creating a subsection of blockspace based on different criteria leads to two outcomes: 1) reduced revenue for miners due to non-fee rate criteria and 2) subjecting selected transactions to different competitive pressures without direct revenue gains for miners. This does not alleviate fee pressure, just results in miners earning less.
Acknowledging blockspace as a tradable asset priced in an open market is crucial. Failing to do so can result in financial losses. Attempting to censor transaction types may compromise Bitcoin’s core principles.
Maintaining decentralized mining with numerous small operators is vital for Bitcoin’s resistance against censorship. It’s concerning to witness economically irrational behavior from smaller miners, given the long-term implications for their success.
This article is a Take. Opinions expressed are entirely the author’s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
