Well, would you look at that—the sun rose this morning, and it's another totally batshit day in the world of Bitcoin. A European Bitcoin exchange just threw 200 bitcoins to the wolves, and users are scrambling to collect them, effectively DDoSing the entire network.
CoinWallet.eu, the exchange in question, is slowly releasing the addresses and private keys for Bitcoin wallets containing 200 coins split into thousands of tiny fractions for anyone to claim. The giveaway was positioned as a gift to the community, but the real intention was to spam the Bitcoin network without CoinWallet.eu ever having to lift a finger. At the time of writing, everything seems to be going according to plan.
As people scramble to get the coins, tons of transactions are being generated and even duplicated since everyone is trying to get the same coins, and it usually takes at least a few minutes for transactions to be confirmed by the network.
The end goal is to prove a point: Bitcoin needs an update so that it can handle wider adoption
The number of backlogged transactions is currently above 90,000 and climbing, and the size of the "memory pool," the database that stores them, is shooting past 150MB. It usually sits below 10. On the Bitcointalk forum, where much of today's action is going down, users are reporting that their Bitcoin clients are crashing when they try to collect the coins.
CoinWallet.eu kicked off the giveaway in lieu of a planned "stress test," which usually involves sending many tiny transactions—.00001 coins each—through the network in an attempt to stop legitimate transactions from being processed and clog the memory pool. If the memory pool gets too large for computers running Bitcoin nodes, which make up the "backbone" of the network, to handle, they may start shutting down. The memory pool is stored locally, so the issue is with the physical memory of the computer running the node itself.
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CoinWallet.eu's previous test, in which the company itself did all the heavy lifting, resulted in the creation of largest Bitcoin transaction ever made in an attempt to clean up the mess. The company's most "successful"—i.e. damaging—test pushed the size of the memory pool past 300MB, and this time, CoinWallet.eu COO James Wilson told me in an email, they had hoped it would go past 1GB.
The end goal is to prove a point: Bitcoin needs an update so that it can handle wider adoption. This time, CoinWallet.eu hoped that people (and their attendant human greed) would do it for them. And it's working. Great job, everyone!