Scaling Noncustodial Mining Payouts with CTV

In a recent engagement at the btc++ conference, an insightful presentation on the DATUM protocol revealed significant challenges encountered by Ocean in executing noncustodial fanout transactions. The root of these complications lies primarily in the firmware restrictions imposed by Antminer on the size of the coinbase transaction. To navigate these constraints, Ocean has been compelled to adopt complex strategies including the fingerprinting of miner hardware and managing multiple work templates for each account. Despite these efforts, the firm faces limitations in its ability to precisely control the coinbase produced by its miners.

Moreover, the talk highlighted a stark contrast between open-source ASIC firmware and proprietary solutions like Antminer's. For instance, Bitaxe’s ESP-miner exemplifies the potential flexibility with open-source alternatives, offering support for substantially large coinbase transactions determined only by the device's memory capacity. This is in sharp contrast to Antminer’s firmware, which restricts the coinbase to a mere dozen outputs, underscoring a significant limitation for operations requiring expansive transaction capabilities.

Additionally, the discourse brought attention to innovative solutions aimed at mitigating some of the challenges presented by Antminer's limitations without necessitating alternative hardware. A notable mention was the addition of Coinbase Playground in the Bitcoin Wiki under "Covenants Uses," which purportedly addresses two pivotal issues: the coinbase size limit inherent to Antminer and the augmentation of block space for additional transactions, thereby potentially increasing fee revenue. Furthermore, the utilization of ark on-chain addresses for payouts presents an alternative mechanism for miners, showcasing a workaround to some of the constraints faced due to firmware limitations. These developments signify a thoughtful approach towards overcoming technical hurdles, enhancing operational efficiency, and optimizing transactional capacity within the blockchain domain.