Malta based bitcoin wallet service provider GreenAddress released some significant changes to their wallet architecture over the past few days which included Replace-By-Fee (RBF) front-end transaction support.
RBF allows bitcoin transactions to be flagged as replaceable until they are confirmed in a block. For users who send transactions with RBF turned on, it allows them to increase the fees on the transaction for faster confirmation times, provided the transaction hasn’t already been confirmed.
Bitcoin Magazine writer Aaron van Wirdum gave a first-hand description of how GreenAddress RBF works in the wallet in recent tests he performed doing different transactions.
van Wirdum explained that RBF is turned on by default in the wallet; users that don’t want to use RBF need to manually turn off this feature in the Settings panel. RBF is an opt-in policy, but unfortunately for GreenAddress users they are forced to opt-out by having to disable the feature. If they don’t, all transactions will be flagged as RBF. This isn’t necessarily a bad thing, depending on how the receiving wallet software handles it; and if the sender isn’t trying to double-spend the transaction.
In the screen capture above, it shows in GreenAddress that if you click the “bump fee” tab you are presented with a few options to bump your fee up to be included in the next block(s), or as van Wirdum describes it, you can “boost” your transaction.
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 bitcoins from the same inputs to the same outputs, but with a higher fee. It only allows users to “boost” a transaction to increase the likelihood a miner will include it in a block.
Clicking on the “bump fee” tab opens a mini-menu. On top of the menu, text displays how fast the transaction is expected to confirm. In my case, it was expected to be included in the next block. Nevertheless, the menu allowed me to bump the fee: times 1.5, times 2 or times 3.
In more of the testing, it was discovered that not all bitcoin miners are supporting RBF yet. 75% of miners according to the test transactions are not supporting RBF, with 20% that are. Additionally, not all wallets are supporting RBF yet. Recently Airbitz released their Matterhorn update, which includes RBF transaction detection. So for example if a user from GreenAddress wallet sends an RBF-enabled transaction to another person using the Airbitz wallet, the Airbitz wallet will detect this type of transaction and notify the user of it.
This is an important workflow for users accepting RBF-enabled transactions. If the person on the receiving end of the RBF-enabled transaction doesn’t wait at least one confirmation, the person sending the transaction could in theory do the replace-by-fee option in an attempt to double-spend the transaction, paying only the change address.
Purchase Bitcoin without visiting a cryptocurrency exchange. Buy BTC and BCH here.