Understand mempool meaning & its usage 📖
Mempool is combined term derived out of the words memory and pool. It’s known as a waiting room of sorts to confirm pending transactions. Additionally, it can be defined as the mechanism of cryptocurrency nodes for storing information on unconfirmed/pending transactions.
When a transaction is broadcasted on a cryptocurrency it is then sent to nodes to validate its transaction. The validation of each transaction depends on a certain criteria that has already been fixed.
If the transaction is verified it gets sent to each other’s connected nodes thus adding the transaction to its memory pool and then adding it to a block.
Like many other blockchains, mempool mechanism also applies to the Ethereum Blockchain.
When an Ethereum Blockchain node receives a transaction, it waits for the transaction to verify first rather than including it in a block. Which means the node runs a series of checks to validate the transaction.
Here are some usual checks for the verification of transaction 👇🏼
- The output should not be greater than the input
- The signature of the transaction should be valid
- The coin belongs to the seller
Prominent uses of Ethereum mempool 🧠
- The Ethereum mempool is used to obtain trading prices on DEX like Uniswap.
- Important tasks like transaction ordering and transaction fee prioritizing can be done by Ethereum mempool.
- Some transactions with low gas prices are dropped. Mempool allows you to analyze the gas prices and adjust transaction prices to avoid getting dropped.
In Proof of Work (POW) miners used to decide the order of transactions but as the Ethereum Merge is now complete, the nature of Miner Extractable Value (MEV) will shift. in Proof of Stake (POS) Ethereum has introduced a block-builder that helps them decide the order of transactions.
Example sentence: Eventually, Alex was able to make his chain longer by sending the legitimate transaction back to the mempool 🧠
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