Earlier this week, we discussed how Monero Research Labs is looking to reduce the network’s transaction size. With a potential transaction size reduction of up to 80%, things are looking rather exciting for this popular altcoin. However, it seems there is a lot more to the implementation of Bulletproofs than was originally assumed. They may serve to reduce Monero’s network fees as well. That would be quite beneficial, as network fees remain problematic for most cryptocurrencies.
Monero Bulletproofs Have a lot to Offer
In the world of cryptocurrency, concerns regarding scaling and transaction fees have become very real. In the case of Bitcoin, its scaling is almost non-existent after nine years. More importantly, its network transaction fees are rising to astronomical heights, making it unfavorable to use it as a currency. Upgrades are in the works as we speak, but until those developments are deployed on the main network, the situation will remain rather problematic. It is an unfortunate reality for the world’s leading cryptocurrency, but there is very little one can do about it right now.
The Monero developers are currently working on a solution that could solve both these problems at once. More specifically, Bulletproofs are capable of both reducing the transaction size (and along with that, improving scaling) as well as reducing overall transaction fees. While this may sound ambitious, it is something well worth keeping an eye on. The Bulletproofs implementation for Monero will herald a lot of positive changes for this currency, especially now that these changes have been deployed on the testnet.
As we touched upon before, Bulletproofs will greatly reduce Monero’s transaction size. Unlike Bitcoin transactions, Monero-related transfers are pretty large in size. This is mainly due to this currency’s focus on privacy and anonymity. To get very technical, every transaction uses a range proof which scales linearly based on the number of outputs and bits in the range. Right now, these range proofs represent the biggest chunk of data comprising every XMR transfer, which has bloated the transaction size. With Bulletproofs, a more efficient approach will be introduced.
When these Bulletproofs are optimized, they will reduce the Monero transaction size by up to 80%. Not only is this a good way to prevent the blockchain from becoming too big, but it will also impact network fees. Monero employs dynamic block scaling to avoid congestion, but that doesn’t mean things can’t be made more efficient. A recent Stanford paper detailed several major improvements related to range proofs.
What is even more intriguing is how the use of Bulletproofs will reduce Monero’s transaction fees by up to 80% as well. A lower transaction size combined with lower fees and dynamic block sizes suddenly makes Monero look like it may become the Bitcoin everyone had hoped for. Moreover, Monero has privacy and anonymity features no other coin can offer right now, which is important to a lot of people as well. It is unclear whether or not this news will cause a major shift in attention to Monero itself, but this is certainly a major development in general.
Considering that the Monero Bulletproofs will go live on the testnet soon, it will be interesting to see how things play out. Rest assured there will be pretty thorough testing of this new code before it is released to the public. No official launch date has been announced at this point, but things are progressing nicely. There will be two stages of deploying Bulletproofs, with a focus on single-output proofs first and foremost. Interesting developments are happening in the world of cryptocurrency; that much is evident.