What is Dust in Cryptocurrencies

Dust is small transactions that an attacker uses to spam the network. With their help, he or she can do two things:

  • take a place in the block and load the network,
  • send transactions to specific addresses and de-anonymize the user via UTXO, through a further transfer path.

The smallest unit of BTC is 1 satoshi. Transactions up to 100–200 satoshi are considered dust.

The First Type of Dust Attacks

Previously, in the cryptocurrency networks which were actively used for payments (primarily Bitcoin), there was competition for a place in the block. This resulted in higher commissions. This was most noticeable at the end of 2017, when the biggest BTC hype in its history awaited.

The now defunct CoinWallet or F2Pool began filling blocks with small transactions. Their motivation is not fully known, but at the same time there was a discussion of forks and increasing the block size from 1 to 2 MB.

By itself, a dust attack and spam transaction cannot be considered a full-fledged attack, since anyone can send as much as they want. They pay a commission and are entitled to it. But it turns out that spam on the network causes inconvenience to everyone else. Members must pay higher fees to bypass the dust in the queue. Otherwise, transactions will be stuck indefinitely.

It was a cheap and effective method to spoil the web. But it worked until some scaling solutions were introduced, such as batch processing and SegWit, the introduction of the Lightning Network and other layers of the network. At the moment, it is more profitable to send only large amounts to the network to offset the high fees.

After the dust attacks, a new function was added to wallets — the ability to adjust the commission rate.

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