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LaurentMT @LaurentMT
, 7 tweets, 2 min read Read on Twitter
Managing the fragmentation of their utxo set will become a critical factor for BTC services.
For example, this entity (oxt.me/entity/tiid/48…) is a wallet controlled by Coinbase. To date, it owns around 203 BTC split in 1,464,545 utxos !
With BTC at $15.8k, it means $3.2M with an average utxo value of 2.2$. #DustInTheChain
This fragmentation is the result of 2 factors: a real business success and a long failure at optimizing their processes (batch transfers, etc).
But there's worse for Coinbase (and their users who pay the tx fees). On several periods during in the last months, this wallet has sent txs with fees >= transfered value.
E.g.:
oxt.me/transaction/c7…

oxt.me/transaction/59…
Note that it's likely that Coinbase isn't the only Bitcoin service having this problem. But of course, none of them will acknowledge that. Better put the blame on protocol developers, trolls, dragons or whatever.
Now here is the thing: Segwit or LN won't help them to solve this issue.
Bigger blocks would.
/end
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