[Mempool spam] Should we as developers reject non-standard Taproot transactions from full nodes?

Posted by Erik Aronesty

May 8, 2023/21:01 UTC

There is a discussion among Bitcoin developers about the impact of non-monetary use on the network stability and game theory. Erik Aronesty argues that non-monetary use, like storing real estate ownership or NFTs, is dangerous to network stability because it throws off the incentive logic for mining fees. Even if a single ordinal is worth $1 billion, the incentive for a reorg would be thrown to the wind. Therefore, he suggests creating a permanent incentive to keep this kind of stuff off of Bitcoin by going at the "incentive/economic layer." He thinks all the opcode validation suggestions are silly since ordinals can time their fork to the same moment and store data in a less efficient way using any number of mechanisms.In response to Michael Folkson's comment about paying an onchain transaction fee greater than the amount receiving, Erik Aronesty argues that there is no benefit aside from losing bitcoin. Michael Folkson argues that if someone wishes to close their Lightning channel during a protracted fee spike where they have to pay an onchain transaction fee greater than the amount received, there is no reason to prevent them from doing so. He thinks that rejecting any transaction where the fee is higher than the sum of the outputs is easier, but Erik Aronesty disagrees, saying that it would impinge on a valid use case as well as requiring a consensus rule change.The context also includes Ali Sherief's concern about the congestion caused by side projects such as BRC-20, which threaten the smooth and normal use of the Bitcoin network as a peer-to-peer digital currency. He suggests taking action in the form of BIPs and/or commits into the Bitcoin Core codebase to curtail the loophole in BIP 342 that has allowed these unintended consequences. An alternative would be to enforce censorship at the node level and introduce a run-time option to instantly prune all non-standard Taproot transactions. However, he acknowledges that some people will have criticisms about this and that a solution should fit everyone's common ground.

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