3 ms·
Have you a source for that? I'd be interested in reading about it. In any case, the end result is the same. There's a large amplification factor in ethereum tr
by joosters 9y ago
Have you a source for that? I'd be interested in reading about it.
In any case, the end result is the same. There's a large amplification factor in ethereum transactions, since many transactions are just the shuffling of coins without any value actually changing hands.
- DennisP 9y agoI did a quick google and didn't find the article I was thinking of. But it's actually only 10% of transactions, which is the metric the OP's article is about, and 68% of transaction value. But if it's just the normal operation of exchanges I don't think we can really conclude that there's no value changing hands. If you transfer funds from one account on Coinbase to another on Kraken or whatever, there's a temporary address involved, just like the article is describing. And it's the same with Bitcoin and other cryptocurrencies.
- joosters 9y agoThe article implies that there are more transactions going on than would be expected for an exchange with lots of user accounts. The first diagram suggests that there is a rotation of transactions, i.e. coins are churned through multiple addresses many times. That kind of thing is not needed to operate an exchange; you just need to gather money from deposits, send money to withdrawals (many exchanges fail at this point :) and shuffle the rest between a hot wallet and an offline store from time to time. In other words, the ethereum transactions are far in excess of what a typical exchange would need. A bitcoin exchange doing so many transactions would probably go bust from the fees alone! (However, the story isn't crystal clear about what they mean by the 'rotation' of transactions. It says 'rotated 80 times' but I'm not sure if that means each input address goes through 80 transactions before going to an output.)