Some miners at OCEAN have started making use of the Coin Age Priority algorithm during block template construction using DATUM. Originally, Bitcoin Core originally selected transactions to include in blocks based on what they had seen first in their mempool. This logic was eventually replaced by prioritizing older coins, i.e. that had been sitting around unspent longer, over other coins. This was eventually only applied to a small portion of the blockspace, and then eventually done away with entirely around the time of Segwit. It’s still maintained in Bitcoin Knots.

I can only speculate as to the motives of the miners doing this, but given OCEAN’s rhetoric I can guess that it has something to do with prioritizing “financial” transactions over others. Even if not, even if it is purely to help small value UTXO owners, it is still every bit as irrational.

You can partition blockspace as a miner however you want, and prioritize ordering of transactions however you wish within those partitions, but it does not change the fact that blockspace is a fungible good being valued on an open market. If criteria other than the feerate are used to decide which transactions to include, you will leave money on the table. The only situation where that would not be true is one where those criteria were 1:1 identical to deciding based on feerate, which would be a meaningless criteria.

Creating a subsection of blockspace selected for by other criteria ultimately accomplishes two things: 1) leaving money on the table as a miner, as definitionally any meaningful non-feerate criteria results in collecting less fees, and 2) create a bucket of blockspace submitted to competitive “fee” pressures according to whatever different criteria is used, without any of that pressure creating direct revenue increases for miners using this new criteria.

The new subsection of blockspace doesn’t ultimately reduce fee pressure, it simply leaves them making less money and users taking advantage of this new transaction selection criteria subjected to different competitive pressures miners do not directly benefit from.

You can’t hide from the reality that blockspace is a fungible good priced on the open market. You can accept that, or you can lose money. The only alternative is to futilely try to censor classes of transactions you don’t like, and if you happen to succeed, you destroy a core property of Bitcoin in the process.

Mining staying decentralized, widely distributed with many small operators, is critical for Bitcoin’s censorship resistance. It’s a shame to see signs like this of such smaller miners being economically irrational, given that it has huge implications for their success long term.

This article is a Take. Opinions expressed are entirely the author's and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

After rocketing up to the highs of $108,000 in December 2024, Bitcoin now has fallen to about $96,000. This has led to renewed debate among analysts as to what this means for the leading cryptocurrency. Some think that it may all be a warning, but others, such as Fundstrat’s Tom Lee, are still bullish long-term.

$50,000 The Worst-Case Scenario?

Recently, Tom Lee shared his opinions with CNBC during an interview as a response to the fears regarding Bitcoin’s latest retreat. He stated that corrections up to $70,000 or even down to $50,000 can happen. Corrections of this type, he continued, have become extremely frequent throughout Bitcoin’s history; hence long-term investors must consider them opportunities and not as problems.

It was with the mention of $50,000 that eyebrows were raised, but Lee’s confidence in Bitcoin’s strength remains unbroken. He said these corrections often prepares the stage for even stronger price recoveries, especially in a market as dynamic as crypto.

A Bold Prediction Amid Uncertainty

Lee predicted that the price of Bitcoin might reach $200,000-$250,000 by the end of 2025, simply because he is convinced that this cryptocurrency will eventually serve as an economic hedge against instability and increase in adoption rates among institutional investors.

Lee also says the current price point of $90,000 will be an ideal entry point for anyone thinking long term. His reasoning is that Bitcoin’s underlying fundamentals remain strong, and the recent pullback hasn’t dented its broader growth narrative.

Lee said that inflation fears are not yet critical, and temporary disruptions, such as natural disasters, can impact data. However, the cautious approach of the Federal Reserve to rate cuts gives room for optimism. A slower pace of inflation and strong earnings from major companies could boost risk assets, including Bitcoin, in the near term.

After Lee’s comment, Bitcoin rebounded a little; it came back to about $96,400. The rebound shows that the market participants were comforted by his analysis.

The lesson for investors is obvious: volatility will probably interrupt Bitcoin’s road of development, but overall the long-term future seems bright. Forecasts for the market range from $50,000 to $250,000, thereby presenting both risk and possibility.

The balancing act between fear and optimism will ultimately shape Bitcoin’s trajectory in the months to come.

Featured image from Shutterstock, chart from TradingView