OKX is among the world’s 10 largest crypto exchanges and processes over $100 billion in spot bitcoin transactions yearly. Nonetheless, regardless of its dimension and seven-year working historical past, its workers made a rookie mistake that hints at solely a primary understanding of the Bitcoin community and managing unspent transaction outputs (UTXO).
The change not too long ago repeated an embarrassing mistake that it first made in October 2023: bidding towards itself. Particularly, it broadcast UTXO-consolidating bitcoin transactions at common payment charges however then, extremely, began bidding towards its personal transactions.
Due to poor safeguards whereas coping with the Bitcoin community, OKX wound up paying six-fold the payment price than it will have in any other case paid had it not bid towards itself.
Ultimately, OKX bid over 350 satoshis per digital byte of information (s/vb) after a beginning bid of simply 53 s/vb to consolidate its UTXOs.
What are bitcoin UTXO consolidations?
Bitcoin wallets that obtain and ship many transactions finish up with numerous UTXOs. These are generally generally known as merely ‘bitcoin,’ the unspent cash in a pockets.
Not like account-based blockchains like Ethereum which robotically consolidate belongings right into a single steadiness, every bitcoin UTXO requires bidding a separate transaction payment in order that miners embody that specific UTXO inside a legitimate block of information.
When transaction charges are excessive on Bitcoin, giant wallets normally enable their UTXO units to proliferate. After a number of months have handed and payment charges have declined, giant wallets take the chance to consolidate their UTXOs.
Learn extra: Ordinals break bitcoin: Transaction charges exceed rewards as congestion rises
Moderately than paying over 1,250 bitcoins in every day charges to retailer knowledge blocks on Bitcoin’s ledger on April 19, for instance, bitcoin customers who waited till in the present day will pay lower than 15 for a similar quantity of information storage.
Persistence for UTXO consolidations definitely permits Bitcoiners to save lots of on their transaction charges — until, after all, they insist on bidding towards themselves.
Protos reached out to OKX for remark however had not acquired a response by press time.
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