Bitcoin is a network that is proven to be stable, but if you want applications on top of Blockchains you have to play by the rules of the system. For notary use cases (for example), where you would store a document hash on the chain, it might not be beneficial to charge a transaction fee for issuing a document, since you would want to encourage your users to create content and perhaps charge people who want to verify the information instead.

Let's say you build a mining pool that accepts zero transaction fee that owns and maintains a certain percentage (let's say 0.1%) of the global Bitcoin mining power. Let's also assume the mining costs (energy, hardware depreciation, etc.) are not an issue (for now).

  • Can a transaction that offers zero fees target this mining pool? (I assume yes, through a tag in metadata perhaps)
  • Could this mining pool filter staged transactions by this tag?
  • Can the mining pool, if it owns 0.1% of the global mining power guarantee the confirmation of the transaction within a certain period of time? (1hr, 10 hrs, 1 day, 1 month, 1 year?)
  • Is there any example out there that do something similar and use an external mechanism how to compensate mining costs?

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Every mining pool can select (valid) transactions for confirmation on basis of whatever criteria they want. If the mining pool had an agreement based on direct payment by those wanting to use the notary service, they could prioritize confirmation of document hash transactions.

The criteria of selection would then perhaps be that they get the transaction from their customer with the request to confirm it.

However, this scheme would only make economic sense for the mining pool, if confirming the notary transactions was more valuable to them than the fees paid by regular transactions. So, in a sense, those notary transactions would have to compete with a similar value level as regular fees anyway.

With 0.1% of the global mining power, the expected time until the pool finds a block is 10000 minutes, which is pretty close to one week. If the pool were to maintain their 0.1% hashrate, it would have a chance of 1 - exp(-4) = 98.1% chance to find at least one block in four weeks.

Something very similar is already happening: BTCC is running a service called BlockPriority that prioritizes transactions of BTCC customers.

That said, it is unclear to me why one would want to encourage users to create bloat on the Bitcoin blockchain. It would make much more sense to create a Merkle tree from all documents to be confirmed, publish it somewhere online, and just anchor the root of that Merkle tree in the blockchain by paying a single transaction fee.

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