AntPool agrees to refund record $3 million Bitcoin transaction fee

Bitcoin BTC -0.077% mining pool AntPool has agreed to refund the record-breaking $3 million transaction fee it mined last week, pending owner verification.

“On November 23rd, some user submitted 83 BTC as a gas fee,” AntPool wrote in the announcement. “The risk control system of AntPool temporarily froze the fee when packaging the transaction. Please contact us before 00:00 (UTC+8) on December 10, 2023 and verify personal identity. After verification, AntPool will refund the fee.”

AntPool requested the original owner of the funds to prepare a signing tool, such as Electrum or Bitcoin Core — the most widely used software implementation of the Bitcoin protocol — using the private key of the address that sent the transaction to sign the message “AntPool”, then send the signed text to its support email address.

Record-breaking $3 million fee

Last week, a Bitcoin user appeared to have accidentally paid the transaction fee of over $3 million last week, setting a new record in U.S. dollar terms for a single Bitcoin transaction.

The transaction paid 83.65 BTC ($3.1 million) to transfer 55.77 BTC ($2.1 million). The pre-transaction balance was 139.42 BTC ($5.2 million), with the user overpaying by 120,528 times, according to Bitcoin explorer Mempool.

The transaction was mined by AntPool in block 818,087 but it had not publicly commented on the matter until now. The previous record $500,000 fee paid in September was subsequently identified as a “fat finger” overpayment by the crypto services provider Paxos. F2Pool, the miner facilitating that transaction, agreed to reimburse the fee to Paxos.

Hack claim

The incident was followed by a Bitcoin user claiming to be the victim of the $3 million transaction fee, stating that it was their wallet that paid the fee and that they had been hacked.

“I created a new cold wallet, transferred 139 BTC to it and it got transferred out to another wallet immediately,” the user “83_5BTC” posted on X. “I can only imagine that someone was running a script on that wallet and that the script had a weird fee calculation. 55 BTC gone forever. 83.5 BTC to be decided.”

The same user had signed a message appearing to demonstrate ownership of the key that made the transaction, verified by Mononaut, the pseudonymous developer behind the Bitcoin explorer Mempool. However, if the wallet was compromised, it could also have been signed by an attacker. This means AntPool would need another method to verify the victim’s identity, Mononaut added. It is unclear whether AntPool intends to do this.

According to Mononaut, the likely cause of a hack was the use of a low-entropy wallet, possibly a brainwallet, meaning it was created with insufficient randomness, making it vulnerable to attacks. The transaction was quickly fee-bumped using replace-by-fee (RBF) — a Bitcoin protocol feature that allows a sender to increase the transaction fee on an unconfirmed transaction, enabling quicker network processing. If it was indeed a low-entropy wallet, multiple attackers could have been competing to steal the funds, Mononaut suggested. This would explain the high fee, with scripts configured to spend a significant portion of the transaction to hinder competitors.

AntPool did not immediately return a request for comment from The Block.