Someone just lost $174,000 in transaction fees to transfer only 2.9 BTC
A lucky Bitcoin miner has earned a huge profit from an unusually high transaction fee paid by one of the network users.
Blockchain data shows that an unidentified user paid 4 BTC (nearly $174,000) in transaction fees on Tuesday.
A costly mistake According to mempool.space, the transaction itself only sent 2.9 BTC to the intended recipient, meaning that the fee was more than 133% of the size of the transaction. The transaction was overpaid by 30,015 times. Specifically, the user paid 1,800,890 satoshi per vByte (sat/vB) – a measure to calculate the demand for block space on Bitcoin at a given time. For that block, the standard transaction only needed to pay around 60 sat/vB.
Someone just paid 4BTC fee (probably by mistake)https://t.co/07dSDJfog3
— Tomer Strolight (@TomerStrolight) January 16, 2024
Tomer Strolight of Swan Bitcoin said:
“When you consolidate UTXOs, make sure you actually consolidate them instead of turning them into a fee.”
UTXO stands for Unspent Transaction Output, which is a transaction that transfers BTC individually and separately in a user’s Bitcoin wallet. These transfers can be seen as Bitcoin blocks that the user controls: some blocks are larger than others (containing more BTC) and all the blocks together make up the balance in the user’s wallet.
Generally, it is best to avoid splitting a user’s BTC into many small UTXOs – especially for economic reasons. When sending large amounts of BTC later, the user has to pay a fee for each UTXO moved, meaning that the more there are, the more expensive the transaction will be.
Onchain data shows that the high-paying user was trying to consolidate their UTXOs to avoid this problem – a technique that merges several smaller outputs into a larger output.
Can the user get their Bitcoin back? Although Bitcoin transactions and fees cannot be changed technically, high-fee transfers are usually refunded by the miners who receive them.
For example, in September, Bitcoin mining pool F2Pool returned money to Paxos after Paxos accidentally paid $500,000 for a Bitcoin transaction.
Months later, mining giant Antpool refunded a record $3.1 million fee to an anonymous user.
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