Image showing how blockchain congestion and transaction queues deter nefarious actors, as studied in web 3.0.
Blockchain congestion and transaction queues actually deter ‘nefarious actors’: Study

The Impact of Full Blocks on Cryptocurrency Security

A recent study by researchers from Florida Atlantic University and the University of Mississippi reveals that blockchains with full blocks, especially when there is a transaction queue, offer added protection from malicious actors, money launderers, and fraudsters. Titled “Bitcoin Blocksize, Custodial Security, and Price”, the paper takes a deep dive into the Mt. Gox crash and other cases where cryptocurrency has been stolen from crypto exchanges.

The research suggests that criminals are likely to conduct their illicit activities as quickly as possible. As stated in the paper:

Exploring the Effects of Block Fullness on Bitcoin Price and Security

To test their hypothesis, the researchers examined historical Bitcoin blockchain data and a crypto exchange “scam report” from 2010 to 2021. They developed a “fullness” score to evaluate the data and created a benchmark.

The team then analyzed the data to determine the impact of block fullness on the price of Bitcoin (BTC) and security. Their findings suggest that block fullness acts as a deterrent to hackers and scammers due to the signal of congestion it sends. Additionally, they concluded that block fullness also signals a rise in network security which is reflected in the price.

The research team found that block fullness is, on average, 20% lower on days with cryptocurrency breaches or frauds.

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