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From: Gloria Zhao <gloriajzhao@gmail.com>
Date: Tue, 21 Sep 2021 17:42:33 +0100
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To: Bastien TEINTURIER <bastien@acinq.fr>
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Subject: Re: [bitcoin-dev] Proposal: Package Mempool Accept and Package RBF
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Hi Bastien,

Excellent diagram :D

> Here the issue is that a revoked commitment tx A' is pinned in other
> mempools, with a long chain of descendants (or descendants that reach
> the maximum replaceable size).
> We would really like A + C to be able to replace this pinned A'.
> We can't submit individually because A on its own won't replace A'...

Right, this is a key motivation for having Package RBF. In this case, A+C
can replace A' + B1...B24.

Due to the descendant limit (each node operator can increase it on their
own node, but the default is 25), A' should have no more than 25
descendants, even including CPFP carve out. As long as A only conflicts
with A', it won't be trying to replace more than 100 transactions. The
proposed package RBF will allow C to pay for A's conflicts, since their
package feerate is used in the fee comparisons. A is not a descendant of
A', so the existence of B1...B24 does not prevent the replacement.

Best,
Gloria

On Tue, Sep 21, 2021 at 4:18 PM Bastien TEINTURIER <bastien@acinq.fr> wrote=
:

> Hi Gloria,
>
> > I believe this attack is mitigated as long as we attempt to submit
> transactions individually
>
> Unfortunately not, as there exists a pinning scenario in LN where a
> different commit tx is pinned, but you actually can't know which one.
>
> Since I really like your diagrams, I made one as well to illustrate:
>
> https://user-images.githubusercontent.com/31281497/134198114-5e9c6857-e8f=
c-405a-be57-18181d5e54cb.jpg
>
> Here the issue is that a revoked commitment tx A' is pinned in other
> mempools, with a long chain of descendants (or descendants that reach
> the maximum replaceable size).
>
> We would really like A + C to be able to replace this pinned A'.
> We can't submit individually because A on its own won't replace A'...
>
> > I would note that this proposal doesn't accommodate something like
> diagram B, where C is getting CPFP carve out and wants to bring a +1
>
> No worries, that case shouldn't be a concern.
> I believe any L2 protocol can always ensure it confirms such tx trees
> "one depth after the other" without impacting funds safety, so it
> only needs to ensure A + C can get into mempools.
>
> Thanks,
> Bastien
>
> Le mar. 21 sept. 2021 =C3=A0 13:18, Gloria Zhao <gloriajzhao@gmail.com> a
> =C3=A9crit :
>
>> Hi Bastien,
>>
>> Thank you for your feedback!
>>
>> > In your example we have a parent transaction A already in the mempool
>> > and an unrelated child B. We submit a package C + D where C spends
>> > another of A's inputs. You're highlighting that this package may be
>> > rejected because of the unrelated transaction(s) B.
>>
>> > The way I see this, an attacker can abuse this rule to ensure
>> > transaction A stays pinned in the mempool without confirming by
>> > broadcasting a set of child transactions that reach these limits
>> > and pay low fees (where A would be a commit tx in LN).
>>
>> I believe you are describing a pinning attack in which your adversarial
>> counterparty attempts to monopolize the mempool descendant limit of the
>> shared  transaction A in order to prevent you from submitting a fee-bump=
ing
>> child C; I've tried to illustrate this as diagram A here:
>> https://user-images.githubusercontent.com/25183001/134159860-068080d0-bb=
b6-4356-ae74-00df00644c74.png
>> (please let me know if I'm misunderstanding).
>>
>> I believe this attack is mitigated as long as we attempt to submit
>> transactions individually (and thus take advantage of CPFP carve out)
>> before attempting package validation. So, in scenario A2, even if the
>> mempool receives a package with A+C, it would deduplicate A, submit C as=
 an
>> individual transaction, and allow it due to the CPFP carve out exemption=
. A
>> more general goal is: if a transaction would propagate successfully on i=
ts
>> own now, it should still propagate regardless of whether it is included =
in
>> a package. The best way to ensure this, as far as I can tell, is to alwa=
ys
>> try to submit them individually first.
>>
>> I would note that this proposal doesn't accommodate something like
>> diagram B, where C is getting CPFP carve out and wants to bring a +1 (e.=
g.
>> C has very low fees and is bumped by D). I don't think this is a use cas=
e
>> since C should be the one fee-bumping A, but since we're talking about
>> limitations around the CPFP carve out, this is it.
>>
>> Let me know if this addresses your concerns?
>>
>> Thanks,
>> Gloria
>>
>> On Mon, Sep 20, 2021 at 10:19 AM Bastien TEINTURIER <bastien@acinq.fr>
>> wrote:
>>
>>> Hi Gloria,
>>>
>>> Thanks for this detailed post!
>>>
>>> The illustrations you provided are very useful for this kind of graph
>>> topology problems.
>>>
>>> The rules you lay out for package RBF look good to me at first glance
>>> as there are some subtle improvements compared to BIP 125.
>>>
>>> > 1. A package cannot exceed `MAX_PACKAGE_COUNT=3D25` count and
>>> > `MAX_PACKAGE_SIZE=3D101KvB` total size [8]
>>>
>>> I have a question regarding this rule, as your example 2C could be
>>> concerning for LN (unless I didn't understand it correctly).
>>>
>>> This also touches on the package RBF rule 5 ("The package cannot
>>> replace more than 100 mempool transactions.")
>>>
>>> In your example we have a parent transaction A already in the mempool
>>> and an unrelated child B. We submit a package C + D where C spends
>>> another of A's inputs. You're highlighting that this package may be
>>> rejected because of the unrelated transaction(s) B.
>>>
>>> The way I see this, an attacker can abuse this rule to ensure
>>> transaction A stays pinned in the mempool without confirming by
>>> broadcasting a set of child transactions that reach these limits
>>> and pay low fees (where A would be a commit tx in LN).
>>>
>>> We had to create the CPFP carve-out rule explicitly to work around
>>> this limitation, and I think it would be necessary for package RBF
>>> as well, because in such cases we do want to be able to submit a
>>> package A + C where C pays high fees to speed up A's confirmation,
>>> regardless of unrelated unconfirmed children of A...
>>>
>>> We could submit only C to benefit from the existing CPFP carve-out
>>> rule, but that wouldn't work if our local mempool doesn't have A yet,
>>> but other remote mempools do.
>>>
>>> Is my concern justified? Is this something that we should dig into a
>>> bit deeper?
>>>
>>> Thanks,
>>> Bastien
>>>
>>> Le jeu. 16 sept. 2021 =C3=A0 09:55, Gloria Zhao via bitcoin-dev <
>>> bitcoin-dev@lists.linuxfoundation.org> a =C3=A9crit :
>>>
>>>> Hi there,
>>>>
>>>> I'm writing to propose a set of mempool policy changes to enable packa=
ge
>>>> validation (in preparation for package relay) in Bitcoin Core. These
>>>> would not
>>>> be consensus or P2P protocol changes. However, since mempool policy
>>>> significantly affects transaction propagation, I believe this is
>>>> relevant for
>>>> the mailing list.
>>>>
>>>> My proposal enables packages consisting of multiple parents and 1
>>>> child. If you
>>>> develop software that relies on specific transaction relay assumptions
>>>> and/or
>>>> are interested in using package relay in the future, I'm very
>>>> interested to hear
>>>> your feedback on the utility or restrictiveness of these package
>>>> policies for
>>>> your use cases.
>>>>
>>>> A draft implementation of this proposal can be found in [Bitcoin Core
>>>> PR#22290][1].
>>>>
>>>> An illustrated version of this post can be found at
>>>> https://gist.github.com/glozow/dc4e9d5c5b14ade7cdfac40f43adb18a.
>>>> I have also linked the images below.
>>>>
>>>> ## Background
>>>>
>>>> Feel free to skip this section if you are already familiar with mempoo=
l
>>>> policy
>>>> and package relay terminology.
>>>>
>>>> ### Terminology Clarifications
>>>>
>>>> * Package =3D an ordered list of related transactions, representable b=
y a
>>>> Directed
>>>>   Acyclic Graph.
>>>> * Package Feerate =3D the total modified fees divided by the total
>>>> virtual size of
>>>>   all transactions in the package.
>>>>     - Modified fees =3D a transaction's base fees + fee delta applied =
by
>>>> the user
>>>>       with `prioritisetransaction`. As such, we expect this to vary
>>>> across
>>>> mempools.
>>>>     - Virtual Size =3D the maximum of virtual sizes calculated using
>>>> [BIP141
>>>>       virtual size][2] and sigop weight. [Implemented here in Bitcoin
>>>> Core][3].
>>>>     - Note that feerate is not necessarily based on the base fees and
>>>> serialized
>>>>       size.
>>>>
>>>> * Fee-Bumping =3D user/wallet actions that take advantage of miner
>>>> incentives to
>>>>   boost a transaction's candidacy for inclusion in a block, including
>>>> Child Pays
>>>> for Parent (CPFP) and [BIP125][12] Replace-by-Fee (RBF). Our intention
>>>> in
>>>> mempool policy is to recognize when the new transaction is more
>>>> economical to
>>>> mine than the original one(s) but not open DoS vectors, so there are
>>>> some
>>>> limitations.
>>>>
>>>> ### Policy
>>>>
>>>> The purpose of the mempool is to store the best (to be most
>>>> incentive-compatible
>>>> with miners, highest feerate) candidates for inclusion in a block.
>>>> Miners use
>>>> the mempool to build block templates. The mempool is also useful as a
>>>> cache for
>>>> boosting block relay and validation performance, aiding transaction
>>>> relay, and
>>>> generating feerate estimations.
>>>>
>>>> Ideally, all consensus-valid transactions paying reasonable fees shoul=
d
>>>> make it
>>>> to miners through normal transaction relay, without any special
>>>> connectivity or
>>>> relationships with miners. On the other hand, nodes do not have
>>>> unlimited
>>>> resources, and a P2P network designed to let any honest node broadcast
>>>> their
>>>> transactions also exposes the transaction validation engine to DoS
>>>> attacks from
>>>> malicious peers.
>>>>
>>>> As such, for unconfirmed transactions we are considering for our
>>>> mempool, we
>>>> apply a set of validation rules in addition to consensus, primarily to
>>>> protect
>>>> us from resource exhaustion and aid our efforts to keep the highest fe=
e
>>>> transactions. We call this mempool _policy_: a set of (configurable,
>>>> node-specific) rules that transactions must abide by in order to be
>>>> accepted
>>>> into our mempool. Transaction "Standardness" rules and mempool
>>>> restrictions such
>>>> as "too-long-mempool-chain" are both examples of policy.
>>>>
>>>> ### Package Relay and Package Mempool Accept
>>>>
>>>> In transaction relay, we currently consider transactions one at a time
>>>> for
>>>> submission to the mempool. This creates a limitation in the node's
>>>> ability to
>>>> determine which transactions have the highest feerates, since we canno=
t
>>>> take
>>>> into account descendants (i.e. cannot use CPFP) until all the
>>>> transactions are
>>>> in the mempool. Similarly, we cannot use a transaction's descendants
>>>> when
>>>> considering it for RBF. When an individual transaction does not meet
>>>> the mempool
>>>> minimum feerate and the user isn't able to create a replacement
>>>> transaction
>>>> directly, it will not be accepted by mempools.
>>>>
>>>> This limitation presents a security issue for applications and users
>>>> relying on
>>>> time-sensitive transactions. For example, Lightning and other protocol=
s
>>>> create
>>>> UTXOs with multiple spending paths, where one counterparty's spending
>>>> path opens
>>>> up after a timelock, and users are protected from cheating scenarios a=
s
>>>> long as
>>>> they redeem on-chain in time. A key security assumption is that all
>>>> parties'
>>>> transactions will propagate and confirm in a timely manner. This
>>>> assumption can
>>>> be broken if fee-bumping does not work as intended.
>>>>
>>>> The end goal for Package Relay is to consider multiple transactions at
>>>> the same
>>>> time, e.g. a transaction with its high-fee child. This may help us
>>>> better
>>>> determine whether transactions should be accepted to our mempool,
>>>> especially if
>>>> they don't meet fee requirements individually or are better RBF
>>>> candidates as a
>>>> package. A combination of changes to mempool validation logic, policy,
>>>> and
>>>> transaction relay allows us to better propagate the transactions with
>>>> the
>>>> highest package feerates to miners, and makes fee-bumping tools more
>>>> powerful
>>>> for users.
>>>>
>>>> The "relay" part of Package Relay suggests P2P messaging changes, but =
a
>>>> large
>>>> part of the changes are in the mempool's package validation logic. We
>>>> call this
>>>> *Package Mempool Accept*.
>>>>
>>>> ### Previous Work
>>>>
>>>> * Given that mempool validation is DoS-sensitive and complex, it would
>>>> be
>>>>   dangerous to haphazardly tack on package validation logic. Many
>>>> efforts have
>>>> been made to make mempool validation less opaque (see [#16400][4],
>>>> [#21062][5],
>>>> [#22675][6], [#22796][7]).
>>>> * [#20833][8] Added basic capabilities for package validation, test
>>>> accepts only
>>>>   (no submission to mempool).
>>>> * [#21800][9] Implemented package ancestor/descendant limit checks for
>>>> arbitrary
>>>>   packages. Still test accepts only.
>>>> * Previous package relay proposals (see [#16401][10], [#19621][11]).
>>>>
>>>> ### Existing Package Rules
>>>>
>>>> These are in master as introduced in [#20833][8] and [#21800][9]. I'll
>>>> consider
>>>> them as "given" in the rest of this document, though they can be
>>>> changed, since
>>>> package validation is test-accept only right now.
>>>>
>>>> 1. A package cannot exceed `MAX_PACKAGE_COUNT=3D25` count and
>>>> `MAX_PACKAGE_SIZE=3D101KvB` total size [8]
>>>>
>>>>    *Rationale*: This is already enforced as mempool ancestor/descendan=
t
>>>> limits.
>>>> Presumably, transactions in a package are all related, so exceeding
>>>> this limit
>>>> would mean that the package can either be split up or it wouldn't pass
>>>> this
>>>> mempool policy.
>>>>
>>>> 2. Packages must be topologically sorted: if any dependencies exist
>>>> between
>>>> transactions, parents must appear somewhere before children. [8]
>>>>
>>>> 3. A package cannot have conflicting transactions, i.e. none of them
>>>> can spend
>>>> the same inputs. This also means there cannot be duplicate
>>>> transactions. [8]
>>>>
>>>> 4. When packages are evaluated against ancestor/descendant limits in a
>>>> test
>>>> accept, the union of all of their descendants and ancestors is
>>>> considered. This
>>>> is essentially a "worst case" heuristic where every transaction in the
>>>> package
>>>> is treated as each other's ancestor and descendant. [8]
>>>> Packages for which ancestor/descendant limits are accurately captured
>>>> by this
>>>> heuristic: [19]
>>>>
>>>> There are also limitations such as the fact that CPFP carve out is not
>>>> applied
>>>> to package transactions. #20833 also disables RBF in package
>>>> validation; this
>>>> proposal overrides that to allow packages to use RBF.
>>>>
>>>> ## Proposed Changes
>>>>
>>>> The next step in the Package Mempool Accept project is to implement
>>>> submission
>>>> to mempool, initially through RPC only. This allows us to test the
>>>> submission
>>>> logic before exposing it on P2P.
>>>>
>>>> ### Summary
>>>>
>>>> - Packages may contain already-in-mempool transactions.
>>>> - Packages are 2 generations, Multi-Parent-1-Child.
>>>> - Fee-related checks use the package feerate. This means that wallets
>>>> can
>>>> create a package that utilizes CPFP.
>>>> - Parents are allowed to RBF mempool transactions with a set of rules
>>>> similar
>>>>   to BIP125. This enables a combination of CPFP and RBF, where a
>>>> transaction's descendant fees pay for replacing mempool conflicts.
>>>>
>>>> There is a draft implementation in [#22290][1]. It is WIP, but feedbac=
k
>>>> is
>>>> always welcome.
>>>>
>>>> ### Details
>>>>
>>>> #### Packages May Contain Already-in-Mempool Transactions
>>>>
>>>> A package may contain transactions that are already in the mempool. We
>>>> remove
>>>> ("deduplicate") those transactions from the package for the purposes o=
f
>>>> package
>>>> mempool acceptance. If a package is empty after deduplication, we do
>>>> nothing.
>>>>
>>>> *Rationale*: Mempools vary across the network. It's possible for a
>>>> parent to be
>>>> accepted to the mempool of a peer on its own due to differences in
>>>> policy and
>>>> fee market fluctuations. We should not reject or penalize the entire
>>>> package for
>>>> an individual transaction as that could be a censorship vector.
>>>>
>>>> #### Packages Are Multi-Parent-1-Child
>>>>
>>>> Only packages of a specific topology are permitted. Namely, a package
>>>> is exactly
>>>> 1 child with all of its unconfirmed parents. After deduplication, the
>>>> package
>>>> may be exactly the same, empty, 1 child, 1 child with just some of its
>>>> unconfirmed parents, etc. Note that it's possible for the parents to b=
e
>>>> indirect
>>>> descendants/ancestors of one another, or for parent and child to share
>>>> a parent,
>>>> so we cannot make any other topology assumptions.
>>>>
>>>> *Rationale*: This allows for fee-bumping by CPFP. Allowing multiple
>>>> parents
>>>> makes it possible to fee-bump a batch of transactions. Restricting
>>>> packages to a
>>>> defined topology is also easier to reason about and simplifies the
>>>> validation
>>>> logic greatly. Multi-parent-1-child allows us to think of the package
>>>> as one big
>>>> transaction, where:
>>>>
>>>> - Inputs =3D all the inputs of parents + inputs of the child that come
>>>> from
>>>>   confirmed UTXOs
>>>> - Outputs =3D all the outputs of the child + all outputs of the parent=
s
>>>> that
>>>>   aren't spent by other transactions in the package
>>>>
>>>> Examples of packages that follow this rule (variations of example A
>>>> show some
>>>> possibilities after deduplication): ![image][15]
>>>>
>>>> #### Fee-Related Checks Use Package Feerate
>>>>
>>>> Package Feerate =3D the total modified fees divided by the total virtu=
al
>>>> size of
>>>> all transactions in the package.
>>>>
>>>> To meet the two feerate requirements of a mempool, i.e., the
>>>> pre-configured
>>>> minimum relay feerate (`minRelayTxFee`) and dynamic mempool minimum
>>>> feerate, the
>>>> total package feerate is used instead of the individual feerate. The
>>>> individual
>>>> transactions are allowed to be below feerate requirements if the
>>>> package meets
>>>> the feerate requirements. For example, the parent(s) in the package ca=
n
>>>> have 0
>>>> fees but be paid for by the child.
>>>>
>>>> *Rationale*: This can be thought of as "CPFP within a package," solvin=
g
>>>> the
>>>> issue of a parent not meeting minimum fees on its own. This allows L2
>>>> applications to adjust their fees at broadcast time instead of
>>>> overshooting or
>>>> risking getting stuck/pinned.
>>>>
>>>> We use the package feerate of the package *after deduplication*.
>>>>
>>>> *Rationale*:  It would be incorrect to use the fees of transactions
>>>> that are
>>>> already in the mempool, as we do not want a transaction's fees to be
>>>> double-counted for both its individual RBF and package RBF.
>>>>
>>>> Examples F and G [14] show the same package, but P1 is submitted
>>>> individually before
>>>> the package in example G. In example F, we can see that the 300vB
>>>> package pays
>>>> an additional 200sat in fees, which is not enough to pay for its own
>>>> bandwidth
>>>> (BIP125#4). In example G, we can see that P1 pays enough to replace M1=
,
>>>> but
>>>> using P1's fees again during package submission would make it look lik=
e
>>>> a 300sat
>>>> increase for a 200vB package. Even including its fees and size would
>>>> not be
>>>> sufficient in this example, since the 300sat looks like enough for the
>>>> 300vB
>>>> package. The calculcation after deduplication is 100sat increase for a
>>>> package
>>>> of size 200vB, which correctly fails BIP125#4. Assume all transactions
>>>> have a
>>>> size of 100vB.
>>>>
>>>> #### Package RBF
>>>>
>>>> If a package meets feerate requirements as a package, the parents in t=
he
>>>> transaction are allowed to replace-by-fee mempool transactions. The
>>>> child cannot
>>>> replace mempool transactions. Multiple transactions can replace the sa=
me
>>>> transaction, but in order to be valid, none of the transactions can tr=
y
>>>> to
>>>> replace an ancestor of another transaction in the same package (which
>>>> would thus
>>>> make its inputs unavailable).
>>>>
>>>> *Rationale*: Even if we are using package feerate, a package will not
>>>> propagate
>>>> as intended if RBF still requires each individual transaction to meet
>>>> the
>>>> feerate requirements.
>>>>
>>>> We use a set of rules slightly modified from BIP125 as follows:
>>>>
>>>> ##### Signaling (Rule #1)
>>>>
>>>> All mempool transactions to be replaced must signal replaceability.
>>>>
>>>> *Rationale*: Package RBF signaling logic should be the same for packag=
e
>>>> RBF and
>>>> single transaction acceptance. This would be updated if single
>>>> transaction
>>>> validation moves to full RBF.
>>>>
>>>> ##### New Unconfirmed Inputs (Rule #2)
>>>>
>>>> A package may include new unconfirmed inputs, but the ancestor feerate
>>>> of the
>>>> child must be at least as high as the ancestor feerates of every
>>>> transaction
>>>> being replaced. This is contrary to BIP125#2, which states "The
>>>> replacement
>>>> transaction may only include an unconfirmed input if that input was
>>>> included in
>>>> one of the original transactions. (An unconfirmed input spends an
>>>> output from a
>>>> currently-unconfirmed transaction.)"
>>>>
>>>> *Rationale*: The purpose of BIP125#2 is to ensure that the replacement
>>>> transaction has a higher ancestor score than the original
>>>> transaction(s) (see
>>>> [comment][13]). Example H [16] shows how adding a new unconfirmed inpu=
t
>>>> can lower the
>>>> ancestor score of the replacement transaction. P1 is trying to replace
>>>> M1, and
>>>> spends an unconfirmed output of M2. P1 pays 800sat, M1 pays 600sat, an=
d
>>>> M2 pays
>>>> 100sat. Assume all transactions have a size of 100vB. While, in
>>>> isolation, P1
>>>> looks like a better mining candidate than M1, it must be mined with M2=
,
>>>> so its
>>>> ancestor feerate is actually 4.5sat/vB.  This is lower than M1's
>>>> ancestor
>>>> feerate, which is 6sat/vB.
>>>>
>>>> In package RBF, the rule analogous to BIP125#2 would be "none of the
>>>> transactions in the package can spend new unconfirmed inputs." Example
>>>> J [17] shows
>>>> why, if any of the package transactions have ancestors, package feerat=
e
>>>> is no
>>>> longer accurate. Even though M2 and M3 are not ancestors of P1 (which
>>>> is the
>>>> replacement transaction in an RBF), we're actually interested in the
>>>> entire
>>>> package. A miner should mine M1 which is 5sat/vB instead of M2, M3, P1=
,
>>>> P2, and
>>>> P3, which is only 4sat/vB. The Package RBF rule cannot be loosened to
>>>> only allow
>>>> the child to have new unconfirmed inputs, either, because it can still
>>>> cause us
>>>> to overestimate the package's ancestor score.
>>>>
>>>> However, enforcing a rule analogous to BIP125#2 would not only make
>>>> Package RBF
>>>> less useful, but would also break Package RBF for packages with parent=
s
>>>> already
>>>> in the mempool: if a package parent has already been submitted, it
>>>> would look
>>>> like the child is spending a "new" unconfirmed input. In example K
>>>> [18], we're
>>>> looking to replace M1 with the entire package including P1, P2, and P3=
.
>>>> We must
>>>> consider the case where one of the parents is already in the mempool
>>>> (in this
>>>> case, P2), which means we must allow P3 to have new unconfirmed inputs=
.
>>>> However,
>>>> M2 lowers the ancestor score of P3 to 4.3sat/vB, so we should not
>>>> replace M1
>>>> with this package.
>>>>
>>>> Thus, the package RBF rule regarding new unconfirmed inputs is less
>>>> strict than
>>>> BIP125#2. However, we still achieve the same goal of requiring the
>>>> replacement
>>>> transactions to have a ancestor score at least as high as the original
>>>> ones. As
>>>> a result, the entire package is required to be a higher feerate mining
>>>> candidate
>>>> than each of the replaced transactions.
>>>>
>>>> Another note: the [comment][13] above the BIP125#2 code in the origina=
l
>>>> RBF
>>>> implementation suggests that the rule was intended to be temporary.
>>>>
>>>> ##### Absolute Fee (Rule #3)
>>>>
>>>> The package must increase the absolute fee of the mempool, i.e. the
>>>> total fees
>>>> of the package must be higher than the absolute fees of the mempool
>>>> transactions
>>>> it replaces. Combined with the CPFP rule above, this differs from
>>>> BIP125 Rule #3
>>>> - an individual transaction in the package may have lower fees than th=
e
>>>>   transaction(s) it is replacing. In fact, it may have 0 fees, and the
>>>> child
>>>> pays for RBF.
>>>>
>>>> ##### Feerate (Rule #4)
>>>>
>>>> The package must pay for its own bandwidth; the package feerate must b=
e
>>>> higher
>>>> than the replaced transactions by at least minimum relay feerate
>>>> (`incrementalRelayFee`). Combined with the CPFP rule above, this
>>>> differs from
>>>> BIP125 Rule #4 - an individual transaction in the package can have a
>>>> lower
>>>> feerate than the transaction(s) it is replacing. In fact, it may have =
0
>>>> fees,
>>>> and the child pays for RBF.
>>>>
>>>> ##### Total Number of Replaced Transactions (Rule #5)
>>>>
>>>> The package cannot replace more than 100 mempool transactions. This is
>>>> identical
>>>> to BIP125 Rule #5.
>>>>
>>>> ### Expected FAQs
>>>>
>>>> 1. Is it possible for only some of the package to make it into the
>>>> mempool?
>>>>
>>>>    Yes, it is. However, since we evict transactions from the mempool b=
y
>>>> descendant score and the package child is supposed to be sponsoring th=
e
>>>> fees of
>>>> its parents, the most common scenario would be all-or-nothing. This is
>>>> incentive-compatible. In fact, to be conservative, package validation
>>>> should
>>>> begin by trying to submit all of the transactions individually, and
>>>> only use the
>>>> package mempool acceptance logic if the parents fail due to low feerat=
e.
>>>>
>>>> 2. Should we allow packages to contain already-confirmed transactions?
>>>>
>>>>     No, for practical reasons. In mempool validation, we actually
>>>> aren't able to
>>>> tell with 100% confidence if we are looking at a transaction that has
>>>> already
>>>> confirmed, because we look up inputs using a UTXO set. If we have
>>>> historical
>>>> block data, it's possible to look for it, but this is inefficient, not
>>>> always
>>>> possible for pruning nodes, and unnecessary because we're not going to
>>>> do
>>>> anything with the transaction anyway. As such, we already have the
>>>> expectation
>>>> that transaction relay is somewhat "stateful" i.e. nobody should be
>>>> relaying
>>>> transactions that have already been confirmed. Similarly, we shouldn't
>>>> be
>>>> relaying packages that contain already-confirmed transactions.
>>>>
>>>> [1]: https://github.com/bitcoin/bitcoin/pull/22290
>>>> [2]:
>>>> https://github.com/bitcoin/bips/blob/1f0b563738199ca60d32b4ba779797fc9=
7d040fe/bip-0141.mediawiki#transaction-size-calculations
>>>> [3]:
>>>> https://github.com/bitcoin/bitcoin/blob/94f83534e4b771944af7d9ed0f4074=
6f392eb75e/src/policy/policy.cpp#L282
>>>> [4]: https://github.com/bitcoin/bitcoin/pull/16400
>>>> [5]: https://github.com/bitcoin/bitcoin/pull/21062
>>>> [6]: https://github.com/bitcoin/bitcoin/pull/22675
>>>> [7]: https://github.com/bitcoin/bitcoin/pull/22796
>>>> [8]: https://github.com/bitcoin/bitcoin/pull/20833
>>>> [9]: https://github.com/bitcoin/bitcoin/pull/21800
>>>> [10]: https://github.com/bitcoin/bitcoin/pull/16401
>>>> [11]: https://github.com/bitcoin/bitcoin/pull/19621
>>>> [12]: https://github.com/bitcoin/bips/blob/master/bip-0125.mediawiki
>>>> [13]:
>>>> https://github.com/bitcoin/bitcoin/pull/6871/files#diff-34d21af3c614ea=
3cee120df276c9c4ae95053830d7f1d3deaf009a4625409ad2R1101-R1104
>>>> [14]:
>>>> https://user-images.githubusercontent.com/25183001/133567078-075a971c-=
0619-4339-9168-b41fd2b90c28.png
>>>> [15]:
>>>> https://user-images.githubusercontent.com/25183001/132856734-fc17da75-=
f875-44bb-b954-cb7a1725cc0d.png
>>>> [16]:
>>>> https://user-images.githubusercontent.com/25183001/133567347-a3e2e4a8-=
ae9c-49f8-abb9-81e8e0aba224.png
>>>> [17]:
>>>> https://user-images.githubusercontent.com/25183001/133567370-21566d0e-=
36c8-4831-b1a8-706634540af3.png
>>>> [18]:
>>>> https://user-images.githubusercontent.com/25183001/133567444-bfff1142-=
439f-4547-800a-2ba2b0242bcb.png
>>>> [19]:
>>>> https://user-images.githubusercontent.com/25183001/133456219-0bb447cb-=
dcb4-4a31-b9c1-7d86205b68bc.png
>>>> [20]:
>>>> https://user-images.githubusercontent.com/25183001/132857787-7b7c6f56-=
af96-44c8-8d78-983719888c19.png
>>>> _______________________________________________
>>>> bitcoin-dev mailing list
>>>> bitcoin-dev@lists.linuxfoundation.org
>>>> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
>>>>
>>>

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Content-Transfer-Encoding: quoted-printable

<div dir=3D"ltr"><div>Hi Bastien,</div><div><br></div><div>Excellent diagra=
m :D</div><div><br></div><div>&gt; Here the issue is that a revoked commitm=
ent tx A&#39; is pinned in other<br>&gt; mempools, with a long chain of des=
cendants (or descendants that reach<br>&gt; the maximum replaceable size).<=
/div><div>&gt; We would really like A + C to be able to replace this pinned=
 A&#39;.<br>&gt; We can&#39;t submit individually because A on its own won&=
#39;t replace A&#39;...<span class=3D"gmail-im"><br></span></div><div><br><=
/div><div>Right, this is a key motivation for having Package RBF. In this c=
ase, A+C can replace A&#39; + B1...B24.</div><div><br></div><div> Due to th=
e descendant limit (each node operator can increase it on their own node, b=
ut the default is 25), A&#39; should have no more than 25 descendants, even=
 including CPFP carve out. As long as A only conflicts with A&#39;, it won&=
#39;t be trying to replace more than 100 transactions. The proposed package=
 RBF will allow C to pay for A&#39;s conflicts, since their package feerate=
 is used in the fee comparisons. A is not a descendant of A&#39;, so the ex=
istence of B1...B24 does not prevent the replacement.</div><div><br></div><=
div>Best,</div><div>Gloria<br></div></div><br><div class=3D"gmail_quote"><d=
iv dir=3D"ltr" class=3D"gmail_attr">On Tue, Sep 21, 2021 at 4:18 PM Bastien=
 TEINTURIER &lt;<a href=3D"mailto:bastien@acinq.fr">bastien@acinq.fr</a>&gt=
; wrote:<br></div><blockquote class=3D"gmail_quote" style=3D"margin:0px 0px=
 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><div di=
r=3D"ltr">Hi Gloria,<br><br>&gt; I believe this attack is mitigated as long=
 as we attempt to submit transactions individually<br><br>Unfortunately not=
, as there exists a pinning scenario in LN where a<br>different commit tx i=
s pinned, but you actually can&#39;t know which one.<br><br>Since I really =
like your diagrams, I made one as well to illustrate:<br><a href=3D"https:/=
/user-images.githubusercontent.com/31281497/134198114-5e9c6857-e8fc-405a-be=
57-18181d5e54cb.jpg" target=3D"_blank">https://user-images.githubuserconten=
t.com/31281497/134198114-5e9c6857-e8fc-405a-be57-18181d5e54cb.jpg</a><br><b=
r>Here the issue is that a revoked commitment tx A&#39; is pinned in other<=
br>mempools, with a long chain of descendants (or descendants that reach<br=
>the maximum replaceable size).<br><br>We would really like A + C to be abl=
e to replace this pinned A&#39;.<br>We can&#39;t submit individually becaus=
e A on its own won&#39;t replace A&#39;...<br><br>&gt; I would note that th=
is proposal doesn&#39;t accommodate something like diagram B, where C is ge=
tting CPFP carve out and wants to bring a +1<br><br>No worries, that case s=
houldn&#39;t be a concern.<br>I believe any L2 protocol can always ensure i=
t confirms such tx trees<br>&quot;one depth after the other&quot; without i=
mpacting funds safety, so it<br>only needs to ensure A + C can get into mem=
pools.<br><br>Thanks,<br>Bastien</div><br><div class=3D"gmail_quote"><div d=
ir=3D"ltr" class=3D"gmail_attr">Le=C2=A0mar. 21 sept. 2021 =C3=A0=C2=A013:1=
8, Gloria Zhao &lt;<a href=3D"mailto:gloriajzhao@gmail.com" target=3D"_blan=
k">gloriajzhao@gmail.com</a>&gt; a =C3=A9crit=C2=A0:<br></div><blockquote c=
lass=3D"gmail_quote" style=3D"margin:0px 0px 0px 0.8ex;border-left:1px soli=
d rgb(204,204,204);padding-left:1ex"><div dir=3D"ltr"><div>Hi Bastien,</div=
><div><br></div><div>Thank you for your feedback!<br></div><div><br></div><=
div>&gt; In your example we have a parent transaction A already in the memp=
ool<br>&gt; and an unrelated child B. We submit a package C + D where C spe=
nds<br>&gt; another of A&#39;s inputs. You&#39;re highlighting that this pa=
ckage may be<br>&gt; rejected because of the unrelated transaction(s) B.<br=
><br>&gt; The way I see this, an attacker can abuse this rule to ensure<br>=
&gt; transaction A stays pinned in the mempool without confirming by<br>&gt=
; broadcasting a set of child transactions that reach these limits<br>&gt; =
and pay low fees (where A would be a commit tx in LN).</div><div><br></div>=
<div>I believe you are describing a pinning attack in which your adversaria=
l counterparty attempts to monopolize the mempool descendant limit of the s=
hared=C2=A0 transaction A in order to prevent you from submitting a fee-bum=
ping child C; I&#39;ve tried to illustrate this as diagram A here: <a href=
=3D"https://user-images.githubusercontent.com/25183001/134159860-068080d0-b=
bb6-4356-ae74-00df00644c74.png" target=3D"_blank">https://user-images.githu=
busercontent.com/25183001/134159860-068080d0-bbb6-4356-ae74-00df00644c74.pn=
g</a> (please let me know if I&#39;m misunderstanding).</div><div><br></div=
><div>I believe this attack is mitigated as long as we attempt to submit tr=
ansactions individually (and thus take advantage of CPFP carve out) before =
attempting package validation. So, in scenario A2, even if the mempool rece=
ives a package with A+C, it would deduplicate A, submit C as an individual =
transaction, and allow it due to the CPFP carve out exemption. A more gener=
al goal is: if a transaction would propagate successfully on its own now, i=
t should still propagate regardless of whether it is included in a package.=
 The best way to ensure this, as far as I can tell, is to always try to sub=
mit them individually first.<br></div><div><br></div><div>I would note that=
 this proposal doesn&#39;t accommodate something like diagram B, where C is=
 getting CPFP carve out and wants to bring a=C2=A0+1 (e.g. C has very low f=
ees and is bumped by D). I don&#39;t think this is a use case since C shoul=
d be the one fee-bumping A, but since we&#39;re talking about limitations a=
round the CPFP carve out, this is it.</div><div><br></div><div>Let me know =
if this addresses your concerns?<br></div><div><br></div><div>Thanks,</div>=
<div>Gloria<br></div></div><br><div class=3D"gmail_quote"><div dir=3D"ltr" =
class=3D"gmail_attr">On Mon, Sep 20, 2021 at 10:19 AM Bastien TEINTURIER &l=
t;<a href=3D"mailto:bastien@acinq.fr" target=3D"_blank">bastien@acinq.fr</a=
>&gt; wrote:<br></div><blockquote class=3D"gmail_quote" style=3D"margin:0px=
 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><di=
v dir=3D"ltr">Hi Gloria,<br><br>Thanks for this detailed post!<br><br>The i=
llustrations you provided are very useful for this kind of graph<br>topolog=
y problems.<br><br>The rules you lay out for package RBF look good to me at=
 first glance<br>as there are some subtle improvements compared to BIP 125.=
<br><br>&gt; 1. A package cannot exceed `MAX_PACKAGE_COUNT=3D25` count and<=
br>&gt; `MAX_PACKAGE_SIZE=3D101KvB` total size [8]<br><br>I have a question=
 regarding this rule, as your example 2C could be<br>concerning for LN (unl=
ess I didn&#39;t understand it correctly).<br><br>This also touches on the =
package RBF rule 5 (&quot;The package cannot<br>replace more than 100 mempo=
ol transactions.&quot;)<br><br>In your example we have a parent transaction=
 A already in the mempool<br>and an unrelated child B. We submit a package =
C + D where C spends<br>another of A&#39;s inputs. You&#39;re highlighting =
that this package may be<br>rejected because of the unrelated transaction(s=
) B.<br><br>The way I see this, an attacker can abuse this rule to ensure<b=
r>transaction A stays pinned in the mempool without confirming by<br>broadc=
asting a set of child transactions that reach these limits<br>and pay low f=
ees (where A would be a commit tx in LN).<br><br>We had to create the CPFP =
carve-out rule explicitly to work around<br>this limitation, and I think it=
 would be necessary for package RBF<br>as well, because in such cases we do=
 want to be able to submit a<br>package A + C where C pays high fees to spe=
ed up A&#39;s confirmation,<br>regardless of unrelated unconfirmed children=
 of A...<br><br>We could submit only C to benefit from the existing CPFP ca=
rve-out<br>rule, but that wouldn&#39;t work if our local mempool doesn&#39;=
t have A yet,<br>but other remote mempools do.<br><br>Is my concern justifi=
ed? Is this something that we should dig into a<br>bit deeper?<br><br>Thank=
s,<br>Bastien</div><br><div class=3D"gmail_quote"><div dir=3D"ltr" class=3D=
"gmail_attr">Le=C2=A0jeu. 16 sept. 2021 =C3=A0=C2=A009:55, Gloria Zhao via =
bitcoin-dev &lt;<a href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" ta=
rget=3D"_blank">bitcoin-dev@lists.linuxfoundation.org</a>&gt; a =C3=A9crit=
=C2=A0:<br></div><blockquote class=3D"gmail_quote" style=3D"margin:0px 0px =
0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><div dir=
=3D"ltr">Hi there,<br><br>I&#39;m writing to propose a set of mempool polic=
y changes to enable package<br>validation (in preparation for package relay=
) in Bitcoin Core. These would not<br>be consensus or P2P protocol changes.=
 However, since mempool policy<br>significantly affects transaction propaga=
tion, I believe this is relevant for<br>the mailing list.<br><br>My proposa=
l enables packages consisting of multiple parents and 1 child. If you<br>de=
velop software that relies on specific transaction relay assumptions and/or=
<br>are interested in using package relay in the future, I&#39;m very inter=
ested to hear<br>your feedback on the utility or restrictiveness of these p=
ackage policies for<br>your use cases.<br><br>A draft implementation of thi=
s proposal can be found in [Bitcoin Core<br>PR#22290][1].<br><br>An illustr=
ated version of this post can be found at<br><div><a href=3D"https://gist.g=
ithub.com/glozow/dc4e9d5c5b14ade7cdfac40f43adb18a" target=3D"_blank">https:=
//gist.github.com/glozow/dc4e9d5c5b14ade7cdfac40f43adb18a</a>.</div><div>I =
have also linked the images below.</div><br>## Background<br><br>Feel free =
to skip this section if you are already familiar with mempool policy<br>and=
 package relay terminology.<br><br>### Terminology Clarifications<br><br>* =
Package =3D an ordered list of related transactions, representable by a Dir=
ected<br>=C2=A0 Acyclic Graph.<br>* Package Feerate =3D the total modified =
fees divided by the total virtual size of<br>=C2=A0 all transactions in the=
 package.<br>=C2=A0 =C2=A0 - Modified fees =3D a transaction&#39;s base fee=
s + fee delta applied by the user<br>=C2=A0 =C2=A0 =C2=A0 with `prioritiset=
ransaction`. As such, we expect this to vary across<br>mempools.<br>=C2=A0 =
=C2=A0 - Virtual Size =3D the maximum of virtual sizes calculated using [BI=
P141<br>=C2=A0 =C2=A0 =C2=A0 virtual size][2] and sigop weight. [Implemente=
d here in Bitcoin Core][3].<br>=C2=A0 =C2=A0 - Note that feerate is not nec=
essarily based on the base fees and serialized<br>=C2=A0 =C2=A0 =C2=A0 size=
.<br><br>* Fee-Bumping =3D user/wallet actions that take advantage of miner=
 incentives to<br>=C2=A0 boost a transaction&#39;s candidacy for inclusion =
in a block, including Child Pays<br>for Parent (CPFP) and [BIP125][12] Repl=
ace-by-Fee (RBF). Our intention in<br>mempool policy is to recognize when t=
he new transaction is more economical to<br>mine than the original one(s) b=
ut not open DoS vectors, so there are some<br>limitations.<br><br>### Polic=
y<br><br>The purpose of the mempool is to store the best (to be most incent=
ive-compatible<br>with miners, highest feerate) candidates for inclusion in=
 a block. Miners use<br>the mempool to build block templates. The mempool i=
s also useful as a cache for<br>boosting block relay and validation perform=
ance, aiding transaction relay, and<br>generating feerate estimations.<br><=
br>Ideally, all consensus-valid transactions paying reasonable fees should =
make it<br>to miners through normal transaction relay, without any special =
connectivity or<br>relationships with miners. On the other hand, nodes do n=
ot have unlimited<br>resources, and a P2P network designed to let any hones=
t node broadcast their<br>transactions also exposes the transaction validat=
ion engine to DoS attacks from<br>malicious peers.<br><br>As such, for unco=
nfirmed transactions we are considering for our mempool, we<br>apply a set =
of validation rules in addition to consensus, primarily to protect<br>us fr=
om resource exhaustion and aid our efforts to keep the highest fee<br>trans=
actions. We call this mempool _policy_: a set of (configurable,<br>node-spe=
cific) rules that transactions must abide by in order to be accepted<br>int=
o our mempool. Transaction &quot;Standardness&quot; rules and mempool restr=
ictions such<br>as &quot;too-long-mempool-chain&quot; are both examples of =
policy.<br><br>### Package Relay and Package Mempool Accept<br><br>In trans=
action relay, we currently consider transactions one at a time for<br>submi=
ssion to the mempool. This creates a limitation in the node&#39;s ability t=
o<br>determine which transactions have the highest feerates, since we canno=
t take<br>into account descendants (i.e. cannot use CPFP) until all the tra=
nsactions are<br>in the mempool. Similarly, we cannot use a transaction&#39=
;s descendants when<br>considering it for RBF. When an individual transacti=
on does not meet the mempool<br>minimum feerate and the user isn&#39;t able=
 to create a replacement transaction<br>directly, it will not be accepted b=
y mempools.<br><br>This limitation presents a security issue for applicatio=
ns and users relying on<br>time-sensitive transactions. For example, Lightn=
ing and other protocols create<br>UTXOs with multiple spending paths, where=
 one counterparty&#39;s spending path opens<br>up after a timelock, and use=
rs are protected from cheating scenarios as long as<br>they redeem on-chain=
 in time. A key security assumption is that all parties&#39;<br>transaction=
s will propagate and confirm in a timely manner. This assumption can<br>be =
broken if fee-bumping does not work as intended.<br><br>The end goal for Pa=
ckage Relay is to consider multiple transactions at the same<br>time, e.g. =
a transaction with its high-fee child. This may help us better<br>determine=
 whether transactions should be accepted to our mempool, especially if<br>t=
hey don&#39;t meet fee requirements individually or are better RBF candidat=
es as a<br>package. A combination of changes to mempool validation logic, p=
olicy, and<br>transaction relay allows us to better propagate the transacti=
ons with the<br>highest package feerates to miners, and makes fee-bumping t=
ools more powerful<br>for users.<br><br>The &quot;relay&quot; part of Packa=
ge Relay suggests P2P messaging changes, but a large<br>part of the changes=
 are in the mempool&#39;s package validation logic. We call this<br>*Packag=
e Mempool Accept*.<br><br>### Previous Work<br><br>* Given that mempool val=
idation is DoS-sensitive and complex, it would be<br>=C2=A0 dangerous to ha=
phazardly tack on package validation logic. Many efforts have<br>been made =
to make mempool validation less opaque (see [#16400][4], [#21062][5],<br>[#=
22675][6], [#22796][7]).<br>* [#20833][8] Added basic capabilities for pack=
age validation, test accepts only<br>=C2=A0 (no submission to mempool).<br>=
* [#21800][9] Implemented package ancestor/descendant limit checks for arbi=
trary<br>=C2=A0 packages. Still test accepts only.<br>* Previous package re=
lay proposals (see [#16401][10], [#19621][11]).<br><br>### Existing Package=
 Rules<br><br>These are in master as introduced in [#20833][8] and [#21800]=
[9]. I&#39;ll consider<br>them as &quot;given&quot; in the rest of this doc=
ument, though they can be changed, since<br>package validation is test-acce=
pt only right now.<br><br>1. A package cannot exceed `MAX_PACKAGE_COUNT=3D2=
5` count and<br>`MAX_PACKAGE_SIZE=3D101KvB` total size [8]<br><br>=C2=A0 =
=C2=A0*Rationale*: This is already enforced as mempool ancestor/descendant =
limits.<br>Presumably, transactions in a package are all related, so exceed=
ing this limit<br>would mean that the package can either be split up or it =
wouldn&#39;t pass this<br>mempool policy.<br><br>2. Packages must be topolo=
gically sorted: if any dependencies exist between<br>transactions, parents =
must appear somewhere before children. [8]<br><br>3. A package cannot have =
conflicting transactions, i.e. none of them can spend<br><div>the same inpu=
ts. This also means there cannot be duplicate transactions. [8]</div><div><=
br></div>4. When packages are evaluated against ancestor/descendant limits =
in a test<br>accept, the union of all of their descendants and ancestors is=
 considered. This<br>is essentially a &quot;worst case&quot; heuristic wher=
e every transaction in the package<br>is treated as each other&#39;s ancest=
or and descendant.  [8]<br>Packages for which ancestor/descendant limits ar=
e accurately captured by this<br><div>heuristic: [19]</div><br>There are al=
so limitations such as the fact that CPFP carve out is not applied<br>to pa=
ckage transactions. #20833 also disables RBF in package validation; this<br=
>proposal overrides that to allow packages to use RBF.<br><br>## Proposed C=
hanges<br><br>The next step in the Package Mempool Accept project is to imp=
lement submission<br>to mempool, initially through RPC only. This allows us=
 to test the submission<br>logic before exposing it on P2P.<br><br>### Summ=
ary<br><br>- Packages may contain already-in-mempool transactions.<br>- Pac=
kages are 2 generations, Multi-Parent-1-Child.<br>- Fee-related checks use =
the package feerate. This means that wallets can<br>create a package that u=
tilizes CPFP.<br>- Parents are allowed to RBF mempool transactions with a s=
et of rules similar<br>=C2=A0 to BIP125. This enables a combination of CPFP=
 and RBF, where a<br>transaction&#39;s descendant fees pay for replacing me=
mpool conflicts.<br><br>There is a draft implementation in [#22290][1]. It =
is WIP, but feedback is<br>always welcome.<br><br>### Details<br><br>#### P=
ackages May Contain Already-in-Mempool Transactions<br><br>A package may co=
ntain transactions that are already in the mempool. We remove<br>(&quot;ded=
uplicate&quot;) those transactions from the package for the purposes of pac=
kage<br>mempool acceptance. If a package is empty after deduplication, we d=
o nothing.<br><br>*Rationale*: Mempools vary across the network. It&#39;s p=
ossible for a parent to be<br>accepted to the mempool of a peer on its own =
due to differences in policy and<br>fee market fluctuations. We should not =
reject or penalize the entire package for<br>an individual transaction as t=
hat could be a censorship vector.<br><br>#### Packages Are Multi-Parent-1-C=
hild<br><br>Only packages of a specific topology are permitted. Namely, a p=
ackage is exactly<br>1 child with all of its unconfirmed parents. After ded=
uplication, the package<br>may be exactly the same, empty, 1 child, 1 child=
 with just some of its<br>unconfirmed parents, etc. Note that it&#39;s poss=
ible for the parents to be indirect<br>descendants/ancestors of one another=
, or for parent and child to share a parent,<br>so we cannot make any other=
 topology assumptions.<br><br>*Rationale*: This allows for fee-bumping by C=
PFP. Allowing multiple parents<br>makes it possible to fee-bump a batch of =
transactions. Restricting packages to a<br>defined topology is also easier =
to reason about and simplifies the validation<br>logic greatly. Multi-paren=
t-1-child allows us to think of the package as one big<br>transaction, wher=
e:<br><br>- Inputs =3D all the inputs of parents + inputs of the child that=
 come from<br>=C2=A0 confirmed UTXOs<br>- Outputs =3D all the outputs of th=
e child + all outputs of the parents that<br>=C2=A0 aren&#39;t spent by oth=
er transactions in the package<br><br>Examples of packages that follow this=
 rule (variations of example A show some<br>possibilities after deduplicati=
on): ![image][15]<br><br>#### Fee-Related Checks Use Package Feerate<br><br=
>Package Feerate =3D the total modified fees divided by the total virtual s=
ize of<br>all transactions in the package.<br><br>To meet the two feerate r=
equirements of a mempool, i.e., the pre-configured<br>minimum relay feerate=
 (`minRelayTxFee`) and dynamic mempool minimum feerate, the<br>total packag=
e feerate is used instead of the individual feerate. The individual<br>tran=
sactions are allowed to be below feerate requirements if the package meets<=
br>the feerate requirements. For example, the parent(s) in the package can =
have 0<br>fees but be paid for by the child.<br><br>*Rationale*: This can b=
e thought of as &quot;CPFP within a package,&quot; solving the<br>issue of =
a parent not meeting minimum fees on its own. This allows L2<br>application=
s to adjust their fees at broadcast time instead of overshooting or<br>risk=
ing getting stuck/pinned.<br><br>We use the package feerate of the package =
*after deduplication*.<br><br>*Rationale*: =C2=A0It would be incorrect to u=
se the fees of transactions that are<br>already in the mempool, as we do no=
t want a transaction&#39;s fees to be<br>double-counted for both its indivi=
dual RBF and package RBF.<br><br>Examples F and G [14] show the same packag=
e, but P1 is submitted individually before<br>the package in example G. In =
example F, we can see that the 300vB package pays<br>an additional 200sat i=
n fees, which is not enough to pay for its own bandwidth<br>(BIP125#4). In =
example G, we can see that P1 pays enough to replace M1, but<br>using P1&#3=
9;s fees again during package submission would make it look like a 300sat<b=
r>increase for a 200vB package. Even including its fees and size would not =
be<br>sufficient in this example, since the 300sat looks like enough for th=
e 300vB<br>package. The calculcation after deduplication is 100sat increase=
 for a package<br>of size 200vB, which correctly fails BIP125#4. Assume all=
 transactions have a<br>size of 100vB.<br><br>#### Package RBF<br><br>If a =
package meets feerate requirements as a package, the parents in the<br>tran=
saction are allowed to replace-by-fee mempool transactions. The child canno=
t<br>replace mempool transactions. Multiple transactions can replace the sa=
me<br>transaction, but in order to be valid, none of the transactions can t=
ry to<br>replace an ancestor of another transaction in the same package (wh=
ich would thus<br>make its inputs unavailable).<br><br>*Rationale*: Even if=
 we are using package feerate, a package will not propagate<br>as intended =
if RBF still requires each individual transaction to meet the<br>feerate re=
quirements.<br><br>We use a set of rules slightly modified from BIP125 as f=
ollows:<br><br>##### Signaling (Rule #1)<br><br>All mempool transactions to=
 be replaced must signal replaceability.<br><br>*Rationale*: Package RBF si=
gnaling logic should be the same for package RBF and<br>single transaction =
acceptance. This would be updated if single transaction<br>validation moves=
 to full RBF.<br><br>##### New Unconfirmed Inputs (Rule #2)<br><br>A packag=
e may include new unconfirmed inputs, but the ancestor feerate of the<br>ch=
ild must be at least as high as the ancestor feerates of every transaction<=
br>being replaced. This is contrary to BIP125#2, which states &quot;The rep=
lacement<br>transaction may only include an unconfirmed input if that input=
 was included in<br>one of the original transactions. (An unconfirmed input=
 spends an output from a<br>currently-unconfirmed transaction.)&quot;<br><b=
r>*Rationale*: The purpose of BIP125#2 is to ensure that the replacement<br=
>transaction has a higher ancestor score than the original transaction(s) (=
see<br>[comment][13]). Example H [16] shows how adding a new unconfirmed in=
put can lower the<br>ancestor score of the replacement transaction. P1 is t=
rying to replace M1, and<br>spends an unconfirmed output of M2. P1 pays 800=
sat, M1 pays 600sat, and M2 pays<br>100sat. Assume all transactions have a =
size of 100vB. While, in isolation, P1<br>looks like a better mining candid=
ate than M1, it must be mined with M2, so its<br>ancestor feerate is actual=
ly 4.5sat/vB.=C2=A0 This is lower than M1&#39;s ancestor<br>feerate, which =
is 6sat/vB.<br><br>In package RBF, the rule analogous to BIP125#2 would be =
&quot;none of the<br>transactions in the package can spend new unconfirmed =
inputs.&quot; Example J [17] shows<br>why, if any of the package transactio=
ns have ancestors, package feerate is no<br>longer accurate. Even though M2=
 and M3 are not ancestors of P1 (which is the<br>replacement transaction in=
 an RBF), we&#39;re actually interested in the entire<br>package. A miner s=
hould mine M1 which is 5sat/vB instead of M2, M3, P1, P2, and<br>P3, which =
is only 4sat/vB. The Package RBF rule cannot be loosened to only allow<br>t=
he child to have new unconfirmed inputs, either, because it can still cause=
 us<br>to overestimate the package&#39;s ancestor score.<br><br>However, en=
forcing a rule analogous to BIP125#2 would not only make Package RBF<br>les=
s useful, but would also break Package RBF for packages with parents alread=
y<br>in the mempool: if a package parent has already been submitted, it wou=
ld look<br>like the child is spending a &quot;new&quot; unconfirmed input. =
In example K [18], we&#39;re<br>looking to replace M1 with the entire packa=
ge including P1, P2, and P3. We must<br>consider the case where one of the =
parents is already in the mempool (in this<br>case, P2), which means we mus=
t allow P3 to have new unconfirmed inputs. However,<br>M2 lowers the ancest=
or score of P3 to 4.3sat/vB, so we should not replace M1<br>with this packa=
ge.<br><br>Thus, the package RBF rule regarding new unconfirmed inputs is l=
ess strict than<br>BIP125#2. However, we still achieve the same goal of req=
uiring the replacement<br>transactions to have a ancestor score at least as=
 high as the original ones. As<br>a result, the entire package is required =
to be a higher feerate mining candidate<br>than each of the replaced transa=
ctions.<br><br>Another note: the [comment][13] above the BIP125#2 code in t=
he original RBF<br>implementation suggests that the rule was intended to be=
 temporary.<br><br>##### Absolute Fee (Rule #3)<br><br>The package must inc=
rease the absolute fee of the mempool, i.e. the total fees<br>of the packag=
e must be higher than the absolute fees of the mempool transactions<br>it r=
eplaces. Combined with the CPFP rule above, this differs from BIP125 Rule #=
3<br>- an individual transaction in the package may have lower fees than th=
e<br>=C2=A0 transaction(s) it is replacing. In fact, it may have 0 fees, an=
d the child<br>pays for RBF.<br><br>##### Feerate (Rule #4)<br><br>The pack=
age must pay for its own bandwidth; the package feerate must be higher<br>t=
han the replaced transactions by at least minimum relay feerate<br>(`increm=
entalRelayFee`). Combined with the CPFP rule above, this differs from<br>BI=
P125 Rule #4 - an individual transaction in the package can have a lower<br=
>feerate than the transaction(s) it is replacing. In fact, it may have 0 fe=
es,<br>and the child pays for RBF.<br><br>##### Total Number of Replaced Tr=
ansactions (Rule #5)<br><br>The package cannot replace more than 100 mempoo=
l transactions. This is identical<br>to BIP125 Rule #5.<br><br>### Expected=
 FAQs<br><br>1. Is it possible for only some of the package to make it into=
 the mempool?<br><br>=C2=A0 =C2=A0Yes, it is. However, since we evict trans=
actions from the mempool by<br>descendant score and the package child is su=
pposed to be sponsoring the fees of<br>its parents, the most common scenari=
o would be all-or-nothing. This is<br>incentive-compatible. In fact, to be =
conservative, package validation should<br>begin by trying to submit all of=
 the transactions individually, and only use the<br>package mempool accepta=
nce logic if the parents fail due to low feerate.<br><br>2. Should we allow=
 packages to contain already-confirmed transactions?<br><br>=C2=A0 =C2=A0 N=
o, for practical reasons. In mempool validation, we actually aren&#39;t abl=
e to<br>tell with 100% confidence if we are looking at a transaction that h=
as already<br>confirmed, because we look up inputs using a UTXO set. If we =
have historical<br>block data, it&#39;s possible to look for it, but this i=
s inefficient, not always<br>possible for pruning nodes, and unnecessary be=
cause we&#39;re not going to do<br>anything with the transaction anyway. As=
 such, we already have the expectation<br>that transaction relay is somewha=
t &quot;stateful&quot; i.e. nobody should be relaying<br>transactions that =
have already been confirmed. Similarly, we shouldn&#39;t be<br>relaying pac=
kages that contain already-confirmed transactions.<br><br>[1]: <a href=3D"h=
ttps://github.com/bitcoin/bitcoin/pull/22290" target=3D"_blank">https://git=
hub.com/bitcoin/bitcoin/pull/22290</a><br>[2]: <a href=3D"https://github.co=
m/bitcoin/bips/blob/1f0b563738199ca60d32b4ba779797fc97d040fe/bip-0141.media=
wiki#transaction-size-calculations" target=3D"_blank">https://github.com/bi=
tcoin/bips/blob/1f0b563738199ca60d32b4ba779797fc97d040fe/bip-0141.mediawiki=
#transaction-size-calculations</a><br>[3]: <a href=3D"https://github.com/bi=
tcoin/bitcoin/blob/94f83534e4b771944af7d9ed0f40746f392eb75e/src/policy/poli=
cy.cpp#L282" target=3D"_blank">https://github.com/bitcoin/bitcoin/blob/94f8=
3534e4b771944af7d9ed0f40746f392eb75e/src/policy/policy.cpp#L282</a><br>[4]:=
 <a href=3D"https://github.com/bitcoin/bitcoin/pull/16400" target=3D"_blank=
">https://github.com/bitcoin/bitcoin/pull/16400</a><br>[5]: <a href=3D"http=
s://github.com/bitcoin/bitcoin/pull/21062" target=3D"_blank">https://github=
.com/bitcoin/bitcoin/pull/21062</a><br>[6]: <a href=3D"https://github.com/b=
itcoin/bitcoin/pull/22675" target=3D"_blank">https://github.com/bitcoin/bit=
coin/pull/22675</a><br>[7]: <a href=3D"https://github.com/bitcoin/bitcoin/p=
ull/22796" target=3D"_blank">https://github.com/bitcoin/bitcoin/pull/22796<=
/a><br>[8]: <a href=3D"https://github.com/bitcoin/bitcoin/pull/20833" targe=
t=3D"_blank">https://github.com/bitcoin/bitcoin/pull/20833</a><br>[9]: <a h=
ref=3D"https://github.com/bitcoin/bitcoin/pull/21800" target=3D"_blank">htt=
ps://github.com/bitcoin/bitcoin/pull/21800</a><br>[10]: <a href=3D"https://=
github.com/bitcoin/bitcoin/pull/16401" target=3D"_blank">https://github.com=
/bitcoin/bitcoin/pull/16401</a><br>[11]: <a href=3D"https://github.com/bitc=
oin/bitcoin/pull/19621" target=3D"_blank">https://github.com/bitcoin/bitcoi=
n/pull/19621</a><br>[12]: <a href=3D"https://github.com/bitcoin/bips/blob/m=
aster/bip-0125.mediawiki" target=3D"_blank">https://github.com/bitcoin/bips=
/blob/master/bip-0125.mediawiki</a><br>[13]: <a href=3D"https://github.com/=
bitcoin/bitcoin/pull/6871/files#diff-34d21af3c614ea3cee120df276c9c4ae950538=
30d7f1d3deaf009a4625409ad2R1101-R1104" target=3D"_blank">https://github.com=
/bitcoin/bitcoin/pull/6871/files#diff-34d21af3c614ea3cee120df276c9c4ae95053=
830d7f1d3deaf009a4625409ad2R1101-R1104</a><br>[14]: <a href=3D"https://user=
-images.githubusercontent.com/25183001/133567078-075a971c-0619-4339-9168-b4=
1fd2b90c28.png" target=3D"_blank">https://user-images.githubusercontent.com=
/25183001/133567078-075a971c-0619-4339-9168-b41fd2b90c28.png</a><br>[15]: <=
a href=3D"https://user-images.githubusercontent.com/25183001/132856734-fc17=
da75-f875-44bb-b954-cb7a1725cc0d.png" target=3D"_blank">https://user-images=
.githubusercontent.com/25183001/132856734-fc17da75-f875-44bb-b954-cb7a1725c=
c0d.png</a><br>[16]: <a href=3D"https://user-images.githubusercontent.com/2=
5183001/133567347-a3e2e4a8-ae9c-49f8-abb9-81e8e0aba224.png" target=3D"_blan=
k">https://user-images.githubusercontent.com/25183001/133567347-a3e2e4a8-ae=
9c-49f8-abb9-81e8e0aba224.png</a><br>[17]: <a href=3D"https://user-images.g=
ithubusercontent.com/25183001/133567370-21566d0e-36c8-4831-b1a8-706634540af=
3.png" target=3D"_blank">https://user-images.githubusercontent.com/25183001=
/133567370-21566d0e-36c8-4831-b1a8-706634540af3.png</a><br>[18]: <a href=3D=
"https://user-images.githubusercontent.com/25183001/133567444-bfff1142-439f=
-4547-800a-2ba2b0242bcb.png" target=3D"_blank">https://user-images.githubus=
ercontent.com/25183001/133567444-bfff1142-439f-4547-800a-2ba2b0242bcb.png</=
a><br>[19]: <a href=3D"https://user-images.githubusercontent.com/25183001/1=
33456219-0bb447cb-dcb4-4a31-b9c1-7d86205b68bc.png" target=3D"_blank">https:=
//user-images.githubusercontent.com/25183001/133456219-0bb447cb-dcb4-4a31-b=
9c1-7d86205b68bc.png</a><br>[20]: <a href=3D"https://user-images.githubuser=
content.com/25183001/132857787-7b7c6f56-af96-44c8-8d78-983719888c19.png" ta=
rget=3D"_blank">https://user-images.githubusercontent.com/25183001/13285778=
7-7b7c6f56-af96-44c8-8d78-983719888c19.png</a><br></div>
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