CPFP carve out is a transaction relay policy implemented in Bitcoin Core that allows a single transaction to moderately exceed the node’s maximum package size and depth limits if that transaction only has one unconfirmed ancestor.

This makes it possible for two-party contract protocols (such as the current LN protocol) to ensure both parties get a chance to use Child-Pays-For-Parent (CPFP) fee bumping. The first party can use fee bumping up to the package limits, but can’t pin the transaction because the second party is able to use CPFP carve out.

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