Wednesday, December 6

Method to accelerate transactions in Bitcoin had double the use in 2021

Key facts:
  • It is an option that allows you to confirm transactions faster by increasing the commission.

  • Although it is not easy to use, more and more wallets and users have this option.

Replace-by-fee, also known as RBF, is a substitution of one transaction for another on the Bitcoin network. This can be done by offering a higher fee for miners, which translates into faster confirmation of the operation. The default enablement of this tool in wallets has grown considerably during 2021.

According to statistics published by Bitcoinops, the RBF option has been activated much more in the last year compared to previous years. As of January 1, 2021, 14% of the transactions of an average of 144 blocks were signaling the RBF. As can be seen in the graph below, this percentage has increased during the year, and almost doubled. More precisely, it reached 27.5% in November.

Since March 2021, the use of Replace-by-fee has increased almost continuously. Fountain:

If you look at the larger scenario, for example taking the last 5 years, the increase is even more pronounced. In 2017, RBF transactions represented less than 0.2%, a percentage that only started to rise at the beginning of 2018, as can be seen in the following graph.

The average of transactions with RBF in the last 5 years is 8.4%. Fountain:

What does the increased use of RBF imply?

Replace-by-fee It is a good way out for those situations in which the commissions of the Bitcoin network go up. In these circumstances, transactions on the Mempool that were sent with low commissions lag behind. If you have urgency to confirm them, you can resort to this alternative.

Increasing RBF-enabled transactions can have two connotations. First of all, they are plus wallets that allow users to perform this replacement of a transaction.

On the other hand, it can also be understood that the technical knowledge of the people who use these wallets has increased. While a few years ago it would have been unlikely that the RBF resource would become massive, today users know more about the functionalities of wallets and take advantage of them when operating.

On average, a quarter of the operations of the 144 blocks analyzed resorted to a commission replacement or RBF.

Replace-by-fee, a method with “little usability”

The complexity of using the RBF method is something that the developers of the bitcoin ecosystem have highlighted in the past. For example, Darío Sneidermanis, CEO of Muun Wallet, had explained to CriptoNoticias that «RBF (Replace-By-Fee) has a thousand cases in which it does not work, very difficult for the user to predict ».

According to research done by his company, the level of usability of this feature “is pretty dire,” Sneidermanis said. On the reasons for this low adoption, he stated that “to be fair, this is mostly caused by the complexity of the RBF rules.”

However, as the statistics show, the figure is increasing and the RBF is enabled in more and more wallets. For example, Electrum is one of those who added this feature during 2021, as reported by CriptoNoticias in April.