Track transaction packages in CTxMemPoolEntry

Associate with each CTxMemPoolEntry all the size/fees of descendant
mempool transactions.  Sort mempool by max(feerate of entry, feerate
of descendants).  Update statistics on-the-fly as transactions enter
or leave the mempool.

Also add ancestor and descendant limiting, so that transactions can
be rejected if the number or size of unconfirmed ancestors exceeds
a target, or if adding a transaction would cause some other mempool
entry to have too many (or too large) a set of unconfirmed in-
mempool descendants.

10 files changed, 993 insertions, 65 deletions

diff --git a/qa/pull-tester/rpc-tests.sh b/qa/pull-tester/rpc-tests.sh
index b97d97b553..2e8a7c69ce 100755
--- a/qa/pull-tester/rpc-tests.sh
+++ b/qa/pull-tester/rpc-tests.sh
@@ -57,6 +57,7 @@ testScriptsExt=(
     'invalidblockrequest.py'
 #    'forknotify.py'
     'p2p-acceptblock.py'
+    'mempool_packages.py'
 );
 
 #if [ "x$ENABLE_ZMQ" = "x1" ]; then
diff --git a/qa/rpc-tests/mempool_packages.py b/qa/rpc-tests/mempool_packages.py
new file mode 100755
index 0000000000..6041f3a3dd
--- /dev/null
+++ b/qa/rpc-tests/mempool_packages.py
@@ -0,0 +1,107 @@
+#!/usr/bin/env python2
+# Copyright (c) 2014-2015 The Bitcoin Core developers
+# Distributed under the MIT software license, see the accompanying
+# file COPYING or http://www.opensource.org/licenses/mit-license.php.
+
+# Test descendant package tracking code
+
+from test_framework.test_framework import BitcoinTestFramework
+from test_framework.util import *
+
+def satoshi_round(amount):
+    return  Decimal(amount).quantize(Decimal('0.00000001'), rounding=ROUND_DOWN)
+
+class MempoolPackagesTest(BitcoinTestFramework):
+
+    def setup_network(self):
+        self.nodes = []
+        self.nodes.append(start_node(0, self.options.tmpdir, ["-maxorphantx=1000", "-relaypriority=0"]))
+        self.is_network_split = False
+        self.sync_all()
+
+    # Build a transaction that spends parent_txid:vout
+    # Return amount sent
+    def chain_transaction(self, parent_txid, vout, value, fee, num_outputs):
+        send_value = satoshi_round((value - fee)/num_outputs)
+        inputs = [ {'txid' : parent_txid, 'vout' : vout} ]
+        outputs = {}
+        for i in xrange(num_outputs):
+            outputs[self.nodes[0].getnewaddress()] = send_value
+        rawtx = self.nodes[0].createrawtransaction(inputs, outputs)
+        signedtx = self.nodes[0].signrawtransaction(rawtx)
+        txid = self.nodes[0].sendrawtransaction(signedtx['hex'])
+        fulltx = self.nodes[0].getrawtransaction(txid, 1)
+        assert(len(fulltx['vout']) == num_outputs) # make sure we didn't generate a change output
+        return (txid, send_value)
+
+    def run_test(self):
+        ''' Mine some blocks and have them mature. '''
+        self.nodes[0].generate(101)
+        utxo = self.nodes[0].listunspent(10)
+        txid = utxo[0]['txid']
+        vout = utxo[0]['vout']
+        value = utxo[0]['amount']
+
+        fee = Decimal("0.0001")
+        # 100 transactions off a confirmed tx should be fine
+        chain = []
+        for i in xrange(100):
+            (txid, sent_value) = self.chain_transaction(txid, 0, value, fee, 1)
+            value = sent_value
+            chain.append(txid)
+
+        # Check mempool has 100 transactions in it, and descendant
+        # count and fees should look correct
+        mempool = self.nodes[0].getrawmempool(True)
+        assert_equal(len(mempool), 100)
+        descendant_count = 1
+        descendant_fees = 0
+        descendant_size = 0
+        SATOSHIS = 100000000
+
+        for x in reversed(chain):
+            assert_equal(mempool[x]['descendantcount'], descendant_count)
+            descendant_fees += mempool[x]['fee']
+            assert_equal(mempool[x]['descendantfees'], SATOSHIS*descendant_fees)
+            descendant_size += mempool[x]['size']
+            assert_equal(mempool[x]['descendantsize'], descendant_size)
+            descendant_count += 1
+
+        # Adding one more transaction on to the chain should fail.
+        try:
+            self.chain_transaction(txid, vout, value, fee, 1)
+        except JSONRPCException as e:
+            print "too-long-ancestor-chain successfully rejected"
+
+        # TODO: test ancestor size limits
+
+        # Now test descendant chain limits
+        txid = utxo[1]['txid']
+        value = utxo[1]['amount']
+        vout = utxo[1]['vout']
+
+        transaction_package = []
+        # First create one parent tx with 10 children
+        (txid, sent_value) = self.chain_transaction(txid, vout, value, fee, 10)
+        parent_transaction = txid
+        for i in xrange(10):
+            transaction_package.append({'txid': txid, 'vout': i, 'amount': sent_value})
+
+        for i in xrange(1000):
+            utxo = transaction_package.pop(0)
+            try:
+                (txid, sent_value) = self.chain_transaction(utxo['txid'], utxo['vout'], utxo['amount'], fee, 10)
+                for j in xrange(10):
+                    transaction_package.append({'txid': txid, 'vout': j, 'amount': sent_value})
+                if i == 998:
+                    mempool = self.nodes[0].getrawmempool(True)
+                    assert_equal(mempool[parent_transaction]['descendantcount'], 1000)
+            except JSONRPCException as e:
+                print e.error['message']
+                assert_equal(i, 999)
+                print "tx that would create too large descendant package successfully rejected"
+
+        # TODO: test descendant size limits
+
+if __name__ == '__main__':
+    MempoolPackagesTest().main()
diff --git a/src/init.cpp b/src/init.cpp
index f03388120c..9f1c1f6864 100644
--- a/src/init.cpp
+++ b/src/init.cpp
@@ -411,6 +411,10 @@ std::string HelpMessage(HelpMessageMode mode)
         strUsage += HelpMessageOpt("-fuzzmessagestest=<n>", "Randomly fuzz 1 of every <n> network messages");
         strUsage += HelpMessageOpt("-flushwallet", strprintf("Run a thread to flush wallet periodically (default: %u)", 1));
         strUsage += HelpMessageOpt("-stopafterblockimport", strprintf("Stop running after importing blocks from disk (default: %u)", 0));
+        strUsage += HelpMessageOpt("-limitancestorcount=<n>", strprintf("Do not accept transactions if number of in-mempool ancestors is <n> or more (default: %u)", DEFAULT_ANCESTOR_LIMIT));
+        strUsage += HelpMessageOpt("-limitancestorsize=<n>", strprintf("Do not accept transactions whose size with all in-mempool ancestors exceeds <n> kilobytes (default: %u)", DEFAULT_ANCESTOR_SIZE_LIMIT));
+        strUsage += HelpMessageOpt("-limitdescendantcount=<n>", strprintf("Do not accept transactions if any ancestor would have <n> or more in-mempool descendants (default: %u)", DEFAULT_DESCENDANT_LIMIT));
+        strUsage += HelpMessageOpt("-limitdescendantsize=<n>", strprintf("Do not accept transactions if any ancestor would have more than <n> kilobytes of in-mempool descendants (default: %u).", DEFAULT_DESCENDANT_SIZE_LIMIT));
     }
     string debugCategories = "addrman, alert, bench, coindb, db, lock, rand, rpc, selectcoins, mempool, mempoolrej, net, proxy, prune, http"; // Don't translate these and qt below
     if (mode == HMM_BITCOIN_QT)
diff --git a/src/main.cpp b/src/main.cpp
index 27278b977a..2a24d38e52 100644
--- a/src/main.cpp
+++ b/src/main.cpp
@@ -921,6 +921,17 @@ bool AcceptToMemoryPool(CTxMemPool& pool, CValidationState &state, const CTransa
                 REJECT_HIGHFEE, "absurdly-high-fee",
                 strprintf("%d > %d", nFees, ::minRelayTxFee.GetFee(nSize) * 10000));
 
+        // Calculate in-mempool ancestors, up to a limit.
+        CTxMemPool::setEntries setAncestors;
+        size_t nLimitAncestors = GetArg("-limitancestorcount", DEFAULT_ANCESTOR_LIMIT);
+        size_t nLimitAncestorSize = GetArg("-limitancestorsize", DEFAULT_ANCESTOR_SIZE_LIMIT)*1000;
+        size_t nLimitDescendants = GetArg("-limitdescendantcount", DEFAULT_DESCENDANT_LIMIT);
+        size_t nLimitDescendantSize = GetArg("-limitdescendantsize", DEFAULT_DESCENDANT_SIZE_LIMIT)*1000;
+        std::string errString;
+        if (!pool.CalculateMemPoolAncestors(entry, setAncestors, nLimitAncestors, nLimitAncestorSize, nLimitDescendants, nLimitDescendantSize, errString)) {
+            return state.DoS(0, false, REJECT_NONSTANDARD, "too-long-mempool-chain", false, errString);
+        }
+
         // Check against previous transactions
         // This is done last to help prevent CPU exhaustion denial-of-service attacks.
         if (!CheckInputs(tx, state, view, true, STANDARD_SCRIPT_VERIFY_FLAGS, true))
@@ -942,7 +953,7 @@ bool AcceptToMemoryPool(CTxMemPool& pool, CValidationState &state, const CTransa
         }
 
         // Store transaction in memory
-        pool.addUnchecked(hash, entry, !IsInitialBlockDownload());
+        pool.addUnchecked(hash, entry, setAncestors, !IsInitialBlockDownload());
     }
 
     SyncWithWallets(tx, NULL);
@@ -2033,13 +2044,23 @@ bool static DisconnectTip(CValidationState &state) {
     if (!FlushStateToDisk(state, FLUSH_STATE_IF_NEEDED))
         return false;
     // Resurrect mempool transactions from the disconnected block.
+    std::vector<uint256> vHashUpdate;
     BOOST_FOREACH(const CTransaction &tx, block.vtx) {
         // ignore validation errors in resurrected transactions
         list<CTransaction> removed;
         CValidationState stateDummy;
-        if (tx.IsCoinBase() || !AcceptToMemoryPool(mempool, stateDummy, tx, false, NULL))
+        if (tx.IsCoinBase() || !AcceptToMemoryPool(mempool, stateDummy, tx, false, NULL)) {
             mempool.remove(tx, removed, true);
+        } else if (mempool.exists(tx.GetHash())) {
+            vHashUpdate.push_back(tx.GetHash());
+        }
     }
+    // AcceptToMemoryPool/addUnchecked all assume that new mempool entries have
+    // no in-mempool children, which is generally not true when adding
+    // previously-confirmed transactions back to the mempool.
+    // UpdateTransactionsFromBlock finds descendants of any transactions in this
+    // block that were added back and cleans up the mempool state.
+    mempool.UpdateTransactionsFromBlock(vHashUpdate);
     mempool.removeCoinbaseSpends(pcoinsTip, pindexDelete->nHeight);
     mempool.check(pcoinsTip);
     // Update chainActive and related variables.
@@ -4258,7 +4279,7 @@ bool static ProcessMessage(CNode* pfrom, string strCommand, CDataStream& vRecv,
             LogPrint("mempool", "AcceptToMemoryPool: peer=%d %s: accepted %s (poolsz %u)\n",
                 pfrom->id, pfrom->cleanSubVer,
                 tx.GetHash().ToString(),
-                mempool.mapTx.size());
+                mempool.size());
 
             // Recursively process any orphan transactions that depended on this one
             set<NodeId> setMisbehaving;
diff --git a/src/main.h b/src/main.h
index e3479b4b3b..a6001eed8f 100644
--- a/src/main.h
+++ b/src/main.h
@@ -43,6 +43,14 @@ struct CNodeStateStats;
 static const bool DEFAULT_ALERTS = true;
 /** Default for -maxorphantx, maximum number of orphan transactions kept in memory */
 static const unsigned int DEFAULT_MAX_ORPHAN_TRANSACTIONS = 100;
+/** Default for -limitancestorcount, max number of in-mempool ancestors */
+static const unsigned int DEFAULT_ANCESTOR_LIMIT = 100;
+/** Default for -limitancestorsize, maximum kilobytes of tx + all in-mempool ancestors */
+static const unsigned int DEFAULT_ANCESTOR_SIZE_LIMIT = 900;
+/** Default for -limitdescendantcount, max number of in-mempool descendants */
+static const unsigned int DEFAULT_DESCENDANT_LIMIT = 1000;
+/** Default for -limitdescendantsize, maximum kilobytes of in-mempool descendants */
+static const unsigned int DEFAULT_DESCENDANT_SIZE_LIMIT = 2500;
 /** The maximum size of a blk?????.dat file (since 0.8) */
 static const unsigned int MAX_BLOCKFILE_SIZE = 0x8000000; // 128 MiB
 /** The pre-allocation chunk size for blk?????.dat files (since 0.8) */
diff --git a/src/memusage.h b/src/memusage.h
index be3964df1b..b475c3313b 100644
--- a/src/memusage.h
+++ b/src/memusage.h
@@ -74,18 +74,30 @@ static inline size_t DynamicUsage(const std::vector<X>& v)
     return MallocUsage(v.capacity() * sizeof(X));
 }
 
-template<typename X>
-static inline size_t DynamicUsage(const std::set<X>& s)
+template<typename X, typename Y>
+static inline size_t DynamicUsage(const std::set<X, Y>& s)
 {
     return MallocUsage(sizeof(stl_tree_node<X>)) * s.size();
 }
 
 template<typename X, typename Y>
-static inline size_t DynamicUsage(const std::map<X, Y>& m)
+static inline size_t IncrementalDynamicUsage(const std::set<X, Y>& s)
+{
+    return MallocUsage(sizeof(stl_tree_node<X>));
+}
+
+template<typename X, typename Y, typename Z>
+static inline size_t DynamicUsage(const std::map<X, Y, Z>& m)
 {
     return MallocUsage(sizeof(stl_tree_node<std::pair<const X, Y> >)) * m.size();
 }
 
+template<typename X, typename Y, typename Z>
+static inline size_t IncrementalDynamicUsage(const std::map<X, Y, Z>& m)
+{
+    return MallocUsage(sizeof(stl_tree_node<std::pair<const X, Y> >));
+}
+
 // Boost data structures
 
 template<typename X>
diff --git a/src/rpcblockchain.cpp b/src/rpcblockchain.cpp
index a1da31b616..1c201ef99d 100644
--- a/src/rpcblockchain.cpp
+++ b/src/rpcblockchain.cpp
@@ -191,6 +191,9 @@ UniValue mempoolToJSON(bool fVerbose = false)
             info.push_back(Pair("height", (int)e.GetHeight()));
             info.push_back(Pair("startingpriority", e.GetPriority(e.GetHeight())));
             info.push_back(Pair("currentpriority", e.GetPriority(chainActive.Height())));
+            info.push_back(Pair("descendantcount", e.GetCountWithDescendants()));
+            info.push_back(Pair("descendantsize", e.GetSizeWithDescendants()));
+            info.push_back(Pair("descendantfees", e.GetFeesWithDescendants()));
             const CTransaction& tx = e.GetTx();
             set<string> setDepends;
             BOOST_FOREACH(const CTxIn& txin, tx.vin)
@@ -245,6 +248,9 @@ UniValue getrawmempool(const UniValue& params, bool fHelp)
             "    \"height\" : n,           (numeric) block height when transaction entered pool\n"
             "    \"startingpriority\" : n, (numeric) priority when transaction entered pool\n"
             "    \"currentpriority\" : n,  (numeric) transaction priority now\n"
+            "    \"descendantcount\" : n,  (numeric) number of in-mempool descendant transactions (including this one)\n"
+            "    \"descendantsize\" : n,   (numeric) size of in-mempool descendants (including this one)\n"
+            "    \"descendantfees\" : n,   (numeric) fees of in-mempool descendants (including this one)\n"
             "    \"depends\" : [           (array) unconfirmed transactions used as inputs for this transaction\n"
             "        \"transactionid\",    (string) parent transaction id\n"
             "       ... ]\n"
diff --git a/src/test/mempool_tests.cpp b/src/test/mempool_tests.cpp
index 7f82a61bf3..5bf1e98e8f 100644
--- a/src/test/mempool_tests.cpp
+++ b/src/test/mempool_tests.cpp
@@ -9,6 +9,7 @@
 
 #include <boost/test/unit_test.hpp>
 #include <list>
+#include <vector>
 
 BOOST_FIXTURE_TEST_SUITE(mempool_tests, TestingSetup)
 
@@ -100,6 +101,16 @@ BOOST_AUTO_TEST_CASE(MempoolRemoveTest)
     removed.clear();
 }
 
+void CheckSort(CTxMemPool &pool, std::vector<std::string> &sortedOrder)
+{
+    BOOST_CHECK_EQUAL(pool.size(), sortedOrder.size());
+    CTxMemPool::indexed_transaction_set::nth_index<1>::type::iterator it = pool.mapTx.get<1>().begin();
+    int count=0;
+    for (; it != pool.mapTx.get<1>().end(); ++it, ++count) {
+        BOOST_CHECK_EQUAL(it->GetTx().GetHash().ToString(), sortedOrder[count]);
+    }
+}
+
 BOOST_AUTO_TEST_CASE(MempoolIndexingTest)
 {
     CTxMemPool pool(CFeeRate(0));
@@ -138,18 +149,136 @@ BOOST_AUTO_TEST_CASE(MempoolIndexingTest)
     tx5.vout[0].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
     tx5.vout[0].nValue = 11 * COIN;
     pool.addUnchecked(tx5.GetHash(), CTxMemPoolEntry(tx5, 10000LL, 1, 10.0, 1, true));
-
-    // there should be 4 transactions in the mempool
     BOOST_CHECK_EQUAL(pool.size(), 5);
 
-    // Check the fee-rate index is in order, should be tx2, tx4, tx1, tx5, tx3
-    CTxMemPool::indexed_transaction_set::nth_index<1>::type::iterator it = pool.mapTx.get<1>().begin();
-    BOOST_CHECK_EQUAL(it++->GetTx().GetHash().ToString(), tx2.GetHash().ToString());
-    BOOST_CHECK_EQUAL(it++->GetTx().GetHash().ToString(), tx4.GetHash().ToString());
-    BOOST_CHECK_EQUAL(it++->GetTx().GetHash().ToString(), tx1.GetHash().ToString());
-    BOOST_CHECK_EQUAL(it++->GetTx().GetHash().ToString(), tx5.GetHash().ToString());
-    BOOST_CHECK_EQUAL(it++->GetTx().GetHash().ToString(), tx3.GetHash().ToString());
-    BOOST_CHECK(it == pool.mapTx.get<1>().end());
+    std::vector<std::string> sortedOrder;
+    sortedOrder.resize(5);
+    sortedOrder[0] = tx2.GetHash().ToString(); // 20000
+    sortedOrder[1] = tx4.GetHash().ToString(); // 15000
+    sortedOrder[2] = tx1.GetHash().ToString(); // 10000
+    sortedOrder[3] = tx5.GetHash().ToString(); // 10000
+    sortedOrder[4] = tx3.GetHash().ToString(); // 0
+    CheckSort(pool, sortedOrder);
+
+    /* low fee but with high fee child */
+    /* tx6 -> tx7 -> tx8, tx9 -> tx10 */
+    CMutableTransaction tx6 = CMutableTransaction();
+    tx6.vout.resize(1);
+    tx6.vout[0].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
+    tx6.vout[0].nValue = 20 * COIN;
+    pool.addUnchecked(tx6.GetHash(), CTxMemPoolEntry(tx6, 0LL, 1, 10.0, 1, true));
+    BOOST_CHECK_EQUAL(pool.size(), 6);
+    // Check that at this point, tx6 is sorted low
+    sortedOrder.push_back(tx6.GetHash().ToString());
+    CheckSort(pool, sortedOrder);
+
+    CTxMemPool::setEntries setAncestors;
+    setAncestors.insert(pool.mapTx.find(tx6.GetHash()));
+    CMutableTransaction tx7 = CMutableTransaction();
+    tx7.vin.resize(1);
+    tx7.vin[0].prevout = COutPoint(tx6.GetHash(), 0);
+    tx7.vin[0].scriptSig = CScript() << OP_11;
+    tx7.vout.resize(2);
+    tx7.vout[0].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
+    tx7.vout[0].nValue = 10 * COIN;
+    tx7.vout[1].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
+    tx7.vout[1].nValue = 1 * COIN;
+
+    CTxMemPool::setEntries setAncestorsCalculated;
+    std::string dummy;
+    CTxMemPoolEntry entry7(tx7, 2000000LL, 1, 10.0, 1, true);
+    BOOST_CHECK_EQUAL(pool.CalculateMemPoolAncestors(entry7, setAncestorsCalculated, 100, 1000000, 1000, 1000000, dummy), true);
+    BOOST_CHECK(setAncestorsCalculated == setAncestors);
+
+    pool.addUnchecked(tx7.GetHash(), CTxMemPoolEntry(tx7, 2000000LL, 1, 10.0, 1, true), setAncestors);
+    BOOST_CHECK_EQUAL(pool.size(), 7);
+
+    // Now tx6 should be sorted higher (high fee child): tx7, tx6, tx2, ...
+    sortedOrder.erase(sortedOrder.end()-1);
+    sortedOrder.insert(sortedOrder.begin(), tx6.GetHash().ToString());
+    sortedOrder.insert(sortedOrder.begin(), tx7.GetHash().ToString());
+    CheckSort(pool, sortedOrder);
+
+    /* low fee child of tx7 */
+    CMutableTransaction tx8 = CMutableTransaction();
+    tx8.vin.resize(1);
+    tx8.vin[0].prevout = COutPoint(tx7.GetHash(), 0);
+    tx8.vin[0].scriptSig = CScript() << OP_11;
+    tx8.vout.resize(1);
+    tx8.vout[0].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
+    tx8.vout[0].nValue = 10 * COIN;
+    setAncestors.insert(pool.mapTx.find(tx7.GetHash()));
+    pool.addUnchecked(tx8.GetHash(), CTxMemPoolEntry(tx8, 0LL, 2, 10.0, 1, true), setAncestors);
+
+    // Now tx8 should be sorted low, but tx6/tx both high
+    sortedOrder.push_back(tx8.GetHash().ToString());
+    CheckSort(pool, sortedOrder);
+
+    /* low fee child of tx7 */
+    CMutableTransaction tx9 = CMutableTransaction();
+    tx9.vin.resize(1);
+    tx9.vin[0].prevout = COutPoint(tx7.GetHash(), 1);
+    tx9.vin[0].scriptSig = CScript() << OP_11;
+    tx9.vout.resize(1);
+    tx9.vout[0].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
+    tx9.vout[0].nValue = 1 * COIN;
+    pool.addUnchecked(tx9.GetHash(), CTxMemPoolEntry(tx9, 0LL, 3, 10.0, 1, true), setAncestors);
+
+    // tx9 should be sorted low
+    BOOST_CHECK_EQUAL(pool.size(), 9);
+    sortedOrder.push_back(tx9.GetHash().ToString());
+    CheckSort(pool, sortedOrder);
+
+    std::vector<std::string> snapshotOrder = sortedOrder;
+
+    setAncestors.insert(pool.mapTx.find(tx8.GetHash()));
+    setAncestors.insert(pool.mapTx.find(tx9.GetHash()));
+    /* tx10 depends on tx8 and tx9 and has a high fee*/
+    CMutableTransaction tx10 = CMutableTransaction();
+    tx10.vin.resize(2);
+    tx10.vin[0].prevout = COutPoint(tx8.GetHash(), 0);
+    tx10.vin[0].scriptSig = CScript() << OP_11;
+    tx10.vin[1].prevout = COutPoint(tx9.GetHash(), 0);
+    tx10.vin[1].scriptSig = CScript() << OP_11;
+    tx10.vout.resize(1);
+    tx10.vout[0].scriptPubKey = CScript() << OP_11 << OP_EQUAL;
+    tx10.vout[0].nValue = 10 * COIN;
+
+    setAncestorsCalculated.clear();
+    CTxMemPoolEntry entry10(tx10, 200000LL, 4, 10.0, 1, true);
+    BOOST_CHECK_EQUAL(pool.CalculateMemPoolAncestors(entry10, setAncestorsCalculated, 100, 1000000, 1000, 1000000, dummy), true);
+    BOOST_CHECK(setAncestorsCalculated == setAncestors);
+
+    pool.addUnchecked(tx10.GetHash(), CTxMemPoolEntry(tx10, 200000LL, 4, 10.0, 1, true), setAncestors);
+
+    /**
+     *  tx8 and tx9 should both now be sorted higher
+     *  Final order after tx10 is added:
+     *
+     *  tx7 = 2.2M (4 txs)
+     *  tx6 = 2.2M (5 txs)
+     *  tx10 = 200k (1 tx)
+     *  tx8 = 200k (2 txs)
+     *  tx9 = 200k (2 txs)
+     *  tx2 = 20000 (1)
+     *  tx4 = 15000 (1)
+     *  tx1 = 10000 (1)
+     *  tx5 = 10000 (1)
+     *  tx3 = 0 (1)
+     */
+    sortedOrder.erase(sortedOrder.end()-2, sortedOrder.end()); // take out tx8, tx9 from the end
+    sortedOrder.insert(sortedOrder.begin()+2, tx10.GetHash().ToString()); // tx10 is after tx6
+    sortedOrder.insert(sortedOrder.begin()+3, tx9.GetHash().ToString());
+    sortedOrder.insert(sortedOrder.begin()+3, tx8.GetHash().ToString());
+    CheckSort(pool, sortedOrder);
+
+    // there should be 10 transactions in the mempool
+    BOOST_CHECK_EQUAL(pool.size(), 10);
+
+    // Now try removing tx10 and verify the sort order returns to normal
+    std::list<CTransaction> removed;
+    pool.remove(pool.mapTx.find(tx10.GetHash())->GetTx(), removed, true);
+    CheckSort(pool, snapshotOrder);
 }
 
 BOOST_AUTO_TEST_SUITE_END()
diff --git a/src/txmempool.cpp b/src/txmempool.cpp
index c410cd0832..2f603e3c9f 100644
--- a/src/txmempool.cpp
+++ b/src/txmempool.cpp
@@ -17,12 +17,6 @@
 
 using namespace std;
 
-CTxMemPoolEntry::CTxMemPoolEntry():
-    nFee(0), nTxSize(0), nModSize(0), nUsageSize(0), nTime(0), dPriority(0.0), hadNoDependencies(false)
-{
-    nHeight = MEMPOOL_HEIGHT;
-}
-
 CTxMemPoolEntry::CTxMemPoolEntry(const CTransaction& _tx, const CAmount& _nFee,
                                  int64_t _nTime, double _dPriority,
                                  unsigned int _nHeight, bool poolHasNoInputsOf):
@@ -32,7 +26,10 @@ CTxMemPoolEntry::CTxMemPoolEntry(const CTransaction& _tx, const CAmount& _nFee,
     nTxSize = ::GetSerializeSize(tx, SER_NETWORK, PROTOCOL_VERSION);
     nModSize = tx.CalculateModifiedSize(nTxSize);
     nUsageSize = RecursiveDynamicUsage(tx);
-    feeRate = CFeeRate(nFee, nTxSize);
+
+    nCountWithDescendants = 1;
+    nSizeWithDescendants = nTxSize;
+    nFeesWithDescendants = nFee;
 }
 
 CTxMemPoolEntry::CTxMemPoolEntry(const CTxMemPoolEntry& other)
@@ -49,6 +46,244 @@ CTxMemPoolEntry::GetPriority(unsigned int currentHeight) const
     return dResult;
 }
 
+// Update the given tx for any in-mempool descendants.
+// Assumes that setMemPoolChildren is correct for the given tx and all
+// descendants.
+bool CTxMemPool::UpdateForDescendants(txiter updateIt, int maxDescendantsToVisit, cacheMap &cachedDescendants, const std::set<uint256> &setExclude)
+{
+    // Track the number of entries (outside setExclude) that we'd need to visit
+    // (will bail out if it exceeds maxDescendantsToVisit)
+    int nChildrenToVisit = 0;
+
+    setEntries stageEntries, setAllDescendants;
+    stageEntries = GetMemPoolChildren(updateIt);
+
+    while (!stageEntries.empty()) {
+        const txiter cit = *stageEntries.begin();
+        if (cit->IsDirty()) {
+            // Don't consider any more children if any descendant is dirty
+            return false;
+        }
+        setAllDescendants.insert(cit);
+        stageEntries.erase(cit);
+        const setEntries &setChildren = GetMemPoolChildren(cit);
+        BOOST_FOREACH(const txiter childEntry, setChildren) {
+            cacheMap::iterator cacheIt = cachedDescendants.find(childEntry);
+            if (cacheIt != cachedDescendants.end()) {
+                // We've already calculated this one, just add the entries for this set
+                // but don't traverse again.
+                BOOST_FOREACH(const txiter cacheEntry, cacheIt->second) {
+                    // update visit count only for new child transactions
+                    // (outside of setExclude and stageEntries)
+                    if (setAllDescendants.insert(cacheEntry).second &&
+                            !setExclude.count(cacheEntry->GetTx().GetHash()) &&
+                            !stageEntries.count(cacheEntry)) {
+                        nChildrenToVisit++;
+                    }
+                }
+            } else if (!setAllDescendants.count(childEntry)) {
+                // Schedule for later processing and update our visit count
+                if (stageEntries.insert(childEntry).second && !setExclude.count(childEntry->GetTx().GetHash())) {
+                        nChildrenToVisit++;
+                }
+            }
+            if (nChildrenToVisit > maxDescendantsToVisit) {
+                return false;
+            }
+        }
+    }
+    // setAllDescendants now contains all in-mempool descendants of updateIt.
+    // Update and add to cached descendant map
+    int64_t modifySize = 0;
+    CAmount modifyFee = 0;
+    int64_t modifyCount = 0;
+    BOOST_FOREACH(txiter cit, setAllDescendants) {
+        if (!setExclude.count(cit->GetTx().GetHash())) {
+            modifySize += cit->GetTxSize();
+            modifyFee += cit->GetFee();
+            modifyCount++;
+            cachedDescendants[updateIt].insert(cit);
+        }
+    }
+    mapTx.modify(updateIt, update_descendant_state(modifySize, modifyFee, modifyCount));
+    return true;
+}
+
+// vHashesToUpdate is the set of transaction hashes from a disconnected block
+// which has been re-added to the mempool.
+// for each entry, look for descendants that are outside hashesToUpdate, and
+// add fee/size information for such descendants to the parent.
+void CTxMemPool::UpdateTransactionsFromBlock(const std::vector<uint256> &vHashesToUpdate)
+{
+    LOCK(cs);
+    // For each entry in vHashesToUpdate, store the set of in-mempool, but not
+    // in-vHashesToUpdate transactions, so that we don't have to recalculate
+    // descendants when we come across a previously seen entry.
+    cacheMap mapMemPoolDescendantsToUpdate;
+
+    // Use a set for lookups into vHashesToUpdate (these entries are already
+    // accounted for in the state of their ancestors)
+    std::set<uint256> setAlreadyIncluded(vHashesToUpdate.begin(), vHashesToUpdate.end());
+
+    // Iterate in reverse, so that whenever we are looking at at a transaction
+    // we are sure that all in-mempool descendants have already been processed.
+    // This maximizes the benefit of the descendant cache and guarantees that
+    // setMemPoolChildren will be updated, an assumption made in
+    // UpdateForDescendants.
+    BOOST_REVERSE_FOREACH(const uint256 &hash, vHashesToUpdate) {
+        // we cache the in-mempool children to avoid duplicate updates
+        setEntries setChildren;
+        // calculate children from mapNextTx
+        txiter it = mapTx.find(hash);
+        if (it == mapTx.end()) {
+            continue;
+        }
+        std::map<COutPoint, CInPoint>::iterator iter = mapNextTx.lower_bound(COutPoint(hash, 0));
+        // First calculate the children, and update setMemPoolChildren to
+        // include them, and update their setMemPoolParents to include this tx.
+        for (; iter != mapNextTx.end() && iter->first.hash == hash; ++iter) {
+            const uint256 &childHash = iter->second.ptx->GetHash();
+            txiter childIter = mapTx.find(childHash);
+            assert(childIter != mapTx.end());
+            // We can skip updating entries we've encountered before or that
+            // are in the block (which are already accounted for).
+            if (setChildren.insert(childIter).second && !setAlreadyIncluded.count(childHash)) {
+                UpdateChild(it, childIter, true);
+                UpdateParent(childIter, it, true);
+            }
+        }
+        if (!UpdateForDescendants(it, 100, mapMemPoolDescendantsToUpdate, setAlreadyIncluded)) {
+            // Mark as dirty if we can't do the calculation.
+            mapTx.modify(it, set_dirty());
+        }
+    }
+}
+
+bool CTxMemPool::CalculateMemPoolAncestors(const CTxMemPoolEntry &entry, setEntries &setAncestors, uint64_t limitAncestorCount, uint64_t limitAncestorSize, uint64_t limitDescendantCount, uint64_t limitDescendantSize, std::string &errString)
+{
+    setEntries parentHashes;
+    const CTransaction &tx = entry.GetTx();
+
+    // Get parents of this transaction that are in the mempool
+    // Entry may or may not already be in the mempool, and GetMemPoolParents()
+    // is only valid for entries in the mempool, so we iterate mapTx to find
+    // parents.
+    // TODO: optimize this so that we only check limits and walk
+    // tx.vin when called on entries not already in the mempool.
+    for (unsigned int i = 0; i < tx.vin.size(); i++) {
+        txiter piter = mapTx.find(tx.vin[i].prevout.hash);
+        if (piter != mapTx.end()) {
+            parentHashes.insert(piter);
+            if (parentHashes.size() + 1 > limitAncestorCount) {
+                errString = strprintf("too many unconfirmed parents [limit: %u]", limitAncestorCount);
+                return false;
+            }
+        }
+    }
+
+    size_t totalSizeWithAncestors = entry.GetTxSize();
+
+    while (!parentHashes.empty()) {
+        txiter stageit = *parentHashes.begin();
+
+        setAncestors.insert(stageit);
+        parentHashes.erase(stageit);
+        totalSizeWithAncestors += stageit->GetTxSize();
+
+        if (stageit->GetSizeWithDescendants() + entry.GetTxSize() > limitDescendantSize) {
+            errString = strprintf("exceeds descendant size limit for tx %s [limit: %u]", stageit->GetTx().GetHash().ToString(), limitDescendantSize);
+            return false;
+        } else if (stageit->GetCountWithDescendants() + 1 > limitDescendantCount) {
+            errString = strprintf("too many descendants for tx %s [limit: %u]", stageit->GetTx().GetHash().ToString(), limitDescendantCount);
+            return false;
+        } else if (totalSizeWithAncestors > limitAncestorSize) {
+            errString = strprintf("exceeds ancestor size limit [limit: %u]", limitAncestorSize);
+            return false;
+        }
+
+        const setEntries & setMemPoolParents = GetMemPoolParents(stageit);
+        BOOST_FOREACH(const txiter &phash, setMemPoolParents) {
+            // If this is a new ancestor, add it.
+            if (setAncestors.count(phash) == 0) {
+                parentHashes.insert(phash);
+            }
+            if (parentHashes.size() + setAncestors.size() + 1 > limitAncestorCount) {
+                errString = strprintf("too many unconfirmed ancestors [limit: %u]", limitAncestorCount);
+                return false;
+            }
+        }
+    }
+
+    return true;
+}
+
+void CTxMemPool::UpdateAncestorsOf(bool add, txiter it, setEntries &setAncestors)
+{
+    setEntries parentIters = GetMemPoolParents(it);
+    // add or remove this tx as a child of each parent
+    BOOST_FOREACH(txiter piter, parentIters) {
+        UpdateChild(piter, it, add);
+    }
+    const int64_t updateCount = (add ? 1 : -1);
+    const int64_t updateSize = updateCount * it->GetTxSize();
+    const CAmount updateFee = updateCount * it->GetFee();
+    BOOST_FOREACH(txiter ancestorIt, setAncestors) {
+        mapTx.modify(ancestorIt, update_descendant_state(updateSize, updateFee, updateCount));
+    }
+}
+
+void CTxMemPool::UpdateChildrenForRemoval(txiter it)
+{
+    const setEntries &setMemPoolChildren = GetMemPoolChildren(it);
+    BOOST_FOREACH(txiter updateIt, setMemPoolChildren) {
+        UpdateParent(updateIt, it, false);
+    }
+}
+
+void CTxMemPool::UpdateForRemoveFromMempool(const setEntries &entriesToRemove)
+{
+    // For each entry, walk back all ancestors and decrement size associated with this
+    // transaction
+    const uint64_t nNoLimit = std::numeric_limits<uint64_t>::max();
+    BOOST_FOREACH(txiter removeIt, entriesToRemove) {
+        setEntries setAncestors;
+        const CTxMemPoolEntry &entry = *removeIt;
+        std::string dummy;
+        CalculateMemPoolAncestors(entry, setAncestors, nNoLimit, nNoLimit, nNoLimit, nNoLimit, dummy);
+        // Note that UpdateAncestorsOf severs the child links that point to
+        // removeIt in the entries for the parents of removeIt.  This is
+        // fine since we don't need to use the mempool children of any entries
+        // to walk back over our ancestors (but we do need the mempool
+        // parents!)
+        UpdateAncestorsOf(false, removeIt, setAncestors);
+    }
+    // After updating all the ancestor sizes, we can now sever the link between each
+    // transaction being removed and any mempool children (ie, update setMemPoolParents
+    // for each direct child of a transaction being removed).
+    BOOST_FOREACH(txiter removeIt, entriesToRemove) {
+        UpdateChildrenForRemoval(removeIt);
+    }
+}
+
+void CTxMemPoolEntry::SetDirty()
+{
+    nCountWithDescendants = 0;
+    nSizeWithDescendants = nTxSize;
+    nFeesWithDescendants = nFee;
+}
+
+void CTxMemPoolEntry::UpdateState(int64_t modifySize, CAmount modifyFee, int64_t modifyCount)
+{
+    if (!IsDirty()) {
+        nSizeWithDescendants += modifySize;
+        assert(int64_t(nSizeWithDescendants) > 0);
+        nFeesWithDescendants += modifyFee;
+        assert(nFeesWithDescendants >= 0);
+        nCountWithDescendants += modifyCount;
+        assert(int64_t(nCountWithDescendants) > 0);
+    }
+}
+
 CTxMemPool::CTxMemPool(const CFeeRate& _minRelayFee) :
     nTransactionsUpdated(0)
 {
@@ -90,34 +325,103 @@ void CTxMemPool::AddTransactionsUpdated(unsigned int n)
     nTransactionsUpdated += n;
 }
 
-
-bool CTxMemPool::addUnchecked(const uint256& hash, const CTxMemPoolEntry &entry, bool fCurrentEstimate)
+bool CTxMemPool::addUnchecked(const uint256& hash, const CTxMemPoolEntry &entry, setEntries &setAncestors, bool fCurrentEstimate)
 {
     // Add to memory pool without checking anything.
     // Used by main.cpp AcceptToMemoryPool(), which DOES do
     // all the appropriate checks.
     LOCK(cs);
-    mapTx.insert(entry);
-    const CTransaction& tx = mapTx.find(hash)->GetTx();
-    for (unsigned int i = 0; i < tx.vin.size(); i++)
+    indexed_transaction_set::iterator newit = mapTx.insert(entry).first;
+    mapLinks.insert(make_pair(newit, TxLinks()));
+
+    // Update cachedInnerUsage to include contained transaction's usage.
+    // (When we update the entry for in-mempool parents, memory usage will be
+    // further updated.)
+    cachedInnerUsage += entry.DynamicMemoryUsage();
+
+    const CTransaction& tx = newit->GetTx();
+    std::set<uint256> setParentTransactions;
+    for (unsigned int i = 0; i < tx.vin.size(); i++) {
         mapNextTx[tx.vin[i].prevout] = CInPoint(&tx, i);
+        setParentTransactions.insert(tx.vin[i].prevout.hash);
+    }
+    // Don't bother worrying about child transactions of this one.
+    // Normal case of a new transaction arriving is that there can't be any
+    // children, because such children would be orphans.
+    // An exception to that is if a transaction enters that used to be in a block.
+    // In that case, our disconnect block logic will call UpdateTransactionsFromBlock
+    // to clean up the mess we're leaving here.
+
+    // Update ancestors with information about this tx
+    BOOST_FOREACH (const uint256 &phash, setParentTransactions) {
+        txiter pit = mapTx.find(phash);
+        if (pit != mapTx.end()) {
+            UpdateParent(newit, pit, true);
+        }
+    }
+    UpdateAncestorsOf(true, newit, setAncestors);
+
     nTransactionsUpdated++;
     totalTxSize += entry.GetTxSize();
-    cachedInnerUsage += entry.DynamicMemoryUsage();
     minerPolicyEstimator->processTransaction(entry, fCurrentEstimate);
 
     return true;
 }
 
+void CTxMemPool::removeUnchecked(txiter it)
+{
+    const uint256 hash = it->GetTx().GetHash();
+    BOOST_FOREACH(const CTxIn& txin, it->GetTx().vin)
+        mapNextTx.erase(txin.prevout);
+
+    totalTxSize -= it->GetTxSize();
+    cachedInnerUsage -= it->DynamicMemoryUsage();
+    cachedInnerUsage -= memusage::DynamicUsage(mapLinks[it].parents) + memusage::DynamicUsage(mapLinks[it].children);
+    mapLinks.erase(it);
+    mapTx.erase(it);
+    nTransactionsUpdated++;
+    minerPolicyEstimator->removeTx(hash);
+}
+
+// Calculates descendants of entry that are not already in setDescendants, and adds to
+// setDescendants. Assumes entryit is already a tx in the mempool and setMemPoolChildren
+// is correct for tx and all descendants.
+// Also assumes that if an entry is in setDescendants already, then all
+// in-mempool descendants of it are already in setDescendants as well, so that we
+// can save time by not iterating over those entries.
+void CTxMemPool::CalculateDescendants(txiter entryit, setEntries &setDescendants)
+{
+    setEntries stage;
+    if (setDescendants.count(entryit) == 0) {
+        stage.insert(entryit);
+    }
+    // Traverse down the children of entry, only adding children that are not
+    // accounted for in setDescendants already (because those children have either
+    // already been walked, or will be walked in this iteration).
+    while (!stage.empty()) {
+        txiter it = *stage.begin();
+        setDescendants.insert(it);
+        stage.erase(it);
+
+        const setEntries &setChildren = GetMemPoolChildren(it);
+        BOOST_FOREACH(const txiter &childiter, setChildren) {
+            if (!setDescendants.count(childiter)) {
+                stage.insert(childiter);
+            }
+        }
+    }
+}
 
 void CTxMemPool::remove(const CTransaction &origTx, std::list<CTransaction>& removed, bool fRecursive)
 {
     // Remove transaction from memory pool
     {
         LOCK(cs);
-        std::deque<uint256> txToRemove;
-        txToRemove.push_back(origTx.GetHash());
-        if (fRecursive && !mapTx.count(origTx.GetHash())) {
+        setEntries txToRemove;
+        txiter origit = mapTx.find(origTx.GetHash());
+        if (origit != mapTx.end()) {
+            txToRemove.insert(origit);
+        } else if (fRecursive) {
             // If recursively removing but origTx isn't in the mempool
             // be sure to remove any children that are in the pool. This can
             // happen during chain re-orgs if origTx isn't re-accepted into
@@ -126,34 +430,23 @@ void CTxMemPool::remove(const CTransaction &origTx, std::list<CTransaction>& rem
                 std::map<COutPoint, CInPoint>::iterator it = mapNextTx.find(COutPoint(origTx.GetHash(), i));
                 if (it == mapNextTx.end())
                     continue;
-                txToRemove.push_back(it->second.ptx->GetHash());
+                txiter nextit = mapTx.find(it->second.ptx->GetHash());
+                assert(nextit != mapTx.end());
+                txToRemove.insert(nextit);
             }
         }
-        while (!txToRemove.empty())
-        {
-            uint256 hash = txToRemove.front();
-            txToRemove.pop_front();
-            if (!mapTx.count(hash))
-                continue;
-            const CTransaction& tx = mapTx.find(hash)->GetTx();
-            if (fRecursive) {
-                for (unsigned int i = 0; i < tx.vout.size(); i++) {
-                    std::map<COutPoint, CInPoint>::iterator it = mapNextTx.find(COutPoint(hash, i));
-                    if (it == mapNextTx.end())
-                        continue;
-                    txToRemove.push_back(it->second.ptx->GetHash());
-                }
+        setEntries setAllRemoves;
+        if (fRecursive) {
+            BOOST_FOREACH(txiter it, txToRemove) {
+                CalculateDescendants(it, setAllRemoves);
             }
-            BOOST_FOREACH(const CTxIn& txin, tx.vin)
-                mapNextTx.erase(txin.prevout);
-
-            removed.push_back(tx);
-            totalTxSize -= mapTx.find(hash)->GetTxSize();
-            cachedInnerUsage -= mapTx.find(hash)->DynamicMemoryUsage();
-            mapTx.erase(hash);
-            nTransactionsUpdated++;
-            minerPolicyEstimator->removeTx(hash);
+        } else {
+            setAllRemoves.swap(txToRemove);
+        }
+        BOOST_FOREACH(txiter it, setAllRemoves) {
+            removed.push_back(it->GetTx());
         }
+        RemoveStaged(setAllRemoves);
     }
 }
 
@@ -229,6 +522,7 @@ void CTxMemPool::removeForBlock(const std::vector<CTransaction>& vtx, unsigned i
 void CTxMemPool::clear()
 {
     LOCK(cs);
+    mapLinks.clear();
     mapTx.clear();
     mapNextTx.clear();
     totalTxSize = 0;
@@ -255,7 +549,12 @@ void CTxMemPool::check(const CCoinsViewCache *pcoins) const
         checkTotal += it->GetTxSize();
         innerUsage += it->DynamicMemoryUsage();
         const CTransaction& tx = it->GetTx();
+        txlinksMap::const_iterator linksiter = mapLinks.find(it);
+        assert(linksiter != mapLinks.end());
+        const TxLinks &links = linksiter->second;
+        innerUsage += memusage::DynamicUsage(links.parents) + memusage::DynamicUsage(links.children);
         bool fDependsWait = false;
+        setEntries setParentCheck;
         BOOST_FOREACH(const CTxIn &txin, tx.vin) {
             // Check that every mempool transaction's inputs refer to available coins, or other mempool tx's.
             indexed_transaction_set::const_iterator it2 = mapTx.find(txin.prevout.hash);
@@ -263,6 +562,7 @@ void CTxMemPool::check(const CCoinsViewCache *pcoins) const
                 const CTransaction& tx2 = it2->GetTx();
                 assert(tx2.vout.size() > txin.prevout.n && !tx2.vout[txin.prevout.n].IsNull());
                 fDependsWait = true;
+                setParentCheck.insert(it2);
             } else {
                 const CCoins* coins = pcoins->AccessCoins(txin.prevout.hash);
                 assert(coins && coins->IsAvailable(txin.prevout.n));
@@ -274,6 +574,33 @@ void CTxMemPool::check(const CCoinsViewCache *pcoins) const
             assert(it3->second.n == i);
             i++;
         }
+        assert(setParentCheck == GetMemPoolParents(it));
+        // Check children against mapNextTx
+        CTxMemPool::setEntries setChildrenCheck;
+        std::map<COutPoint, CInPoint>::const_iterator iter = mapNextTx.lower_bound(COutPoint(it->GetTx().GetHash(), 0));
+        int64_t childSizes = 0;
+        CAmount childFees = 0;
+        for (; iter != mapNextTx.end() && iter->first.hash == it->GetTx().GetHash(); ++iter) {
+            txiter childit = mapTx.find(iter->second.ptx->GetHash());
+            assert(childit != mapTx.end()); // mapNextTx points to in-mempool transactions
+            if (setChildrenCheck.insert(childit).second) {
+                childSizes += childit->GetTxSize();
+                childFees += childit->GetFee();
+            }
+        }
+        assert(setChildrenCheck == GetMemPoolChildren(it));
+        // Also check to make sure size/fees is greater than sum with immediate children.
+        // just a sanity check, not definitive that this calc is correct...
+        // also check that the size is less than the size of the entire mempool.
+        if (!it->IsDirty()) {
+            assert(it->GetSizeWithDescendants() >= childSizes + it->GetTxSize());
+            assert(it->GetFeesWithDescendants() >= childFees + it->GetFee());
+        } else {
+            assert(it->GetSizeWithDescendants() == it->GetTxSize());
+            assert(it->GetFeesWithDescendants() == it->GetFee());
+        }
+        assert(it->GetFeesWithDescendants() >= 0);
+
         if (fDependsWait)
             waitingOnDependants.push_back(&(*it));
         else {
@@ -432,6 +759,60 @@ bool CCoinsViewMemPool::HaveCoins(const uint256 &txid) const {
 
 size_t CTxMemPool::DynamicMemoryUsage() const {
     LOCK(cs);
-    // Estimate the overhead of mapTx to be 6 pointers + an allocation, as no exact formula for boost::multi_index_contained is implemented.
-    return memusage::MallocUsage(sizeof(CTxMemPoolEntry) + 6 * sizeof(void*)) * mapTx.size() + memusage::DynamicUsage(mapNextTx) + memusage::DynamicUsage(mapDeltas) + cachedInnerUsage;
+    // Estimate the overhead of mapTx to be 9 pointers + an allocation, as no exact formula for boost::multi_index_contained is implemented.
+    return memusage::MallocUsage(sizeof(CTxMemPoolEntry) + 9 * sizeof(void*)) * mapTx.size() + memusage::DynamicUsage(mapNextTx) + memusage::DynamicUsage(mapDeltas) + memusage::DynamicUsage(mapLinks) + cachedInnerUsage;
+}
+
+void CTxMemPool::RemoveStaged(setEntries &stage) {
+    AssertLockHeld(cs);
+    UpdateForRemoveFromMempool(stage);
+    BOOST_FOREACH(const txiter& it, stage) {
+        removeUnchecked(it);
+    }
+}
+
+bool CTxMemPool::addUnchecked(const uint256&hash, const CTxMemPoolEntry &entry, bool fCurrentEstimate)
+{
+    LOCK(cs);
+    setEntries setAncestors;
+    uint64_t nNoLimit = std::numeric_limits<uint64_t>::max();
+    std::string dummy;
+    CalculateMemPoolAncestors(entry, setAncestors, nNoLimit, nNoLimit, nNoLimit, nNoLimit, dummy);
+    return addUnchecked(hash, entry, setAncestors, fCurrentEstimate);
+}
+
+void CTxMemPool::UpdateChild(txiter entry, txiter child, bool add)
+{
+    setEntries s;
+    if (add && mapLinks[entry].children.insert(child).second) {
+        cachedInnerUsage += memusage::IncrementalDynamicUsage(s);
+    } else if (!add && mapLinks[entry].children.erase(child)) {
+        cachedInnerUsage -= memusage::IncrementalDynamicUsage(s);
+    }
+}
+
+void CTxMemPool::UpdateParent(txiter entry, txiter parent, bool add)
+{
+    setEntries s;
+    if (add && mapLinks[entry].parents.insert(parent).second) {
+        cachedInnerUsage += memusage::IncrementalDynamicUsage(s);
+    } else if (!add && mapLinks[entry].parents.erase(parent)) {
+        cachedInnerUsage -= memusage::IncrementalDynamicUsage(s);
+    }
+}
+
+const CTxMemPool::setEntries & CTxMemPool::GetMemPoolParents(txiter entry) const
+{
+    assert (entry != mapTx.end());
+    txlinksMap::const_iterator it = mapLinks.find(entry);
+    assert(it != mapLinks.end());
+    return it->second.parents;
+}
+
+const CTxMemPool::setEntries & CTxMemPool::GetMemPoolChildren(txiter entry) const
+{
+    assert (entry != mapTx.end());
+    txlinksMap::const_iterator it = mapLinks.find(entry);
+    assert(it != mapLinks.end());
+    return it->second.children;
 }
diff --git a/src/txmempool.h b/src/txmempool.h
index 6b6b05454a..f0c3f7e0f1 100644
--- a/src/txmempool.h
+++ b/src/txmempool.h
@@ -7,6 +7,7 @@
 #define BITCOIN_TXMEMPOOL_H
 
 #include <list>
+#include <set>
 
 #include "amount.h"
 #include "coins.h"
@@ -34,9 +35,25 @@ inline bool AllowFree(double dPriority)
 /** Fake height value used in CCoins to signify they are only in the memory pool (since 0.8) */
 static const unsigned int MEMPOOL_HEIGHT = 0x7FFFFFFF;
 
-/**
- * CTxMemPool stores these:
+class CTxMemPool;
+
+/** \class CTxMemPoolEntry
+ *
+ * CTxMemPoolEntry stores data about the correponding transaction, as well
+ * as data about all in-mempool transactions that depend on the transaction
+ * ("descendant" transactions).
+ *
+ * When a new entry is added to the mempool, we update the descendant state
+ * (nCountWithDescendants, nSizeWithDescendants, and nFeesWithDescendants) for
+ * all ancestors of the newly added transaction.
+ *
+ * If updating the descendant state is skipped, we can mark the entry as
+ * "dirty", and set nSizeWithDescendants/nFeesWithDescendants to equal nTxSize/
+ * nTxFee. (This can potentially happen during a reorg, where we limit the
+ * amount of work we're willing to do to avoid consuming too much CPU.)
+ *
  */
+
 class CTxMemPoolEntry
 {
 private:
@@ -45,27 +62,69 @@ private:
     size_t nTxSize; //! ... and avoid recomputing tx size
     size_t nModSize; //! ... and modified size for priority
     size_t nUsageSize; //! ... and total memory usage
-    CFeeRate feeRate; //! ... and fee per kB
     int64_t nTime; //! Local time when entering the mempool
     double dPriority; //! Priority when entering the mempool
     unsigned int nHeight; //! Chain height when entering the mempool
     bool hadNoDependencies; //! Not dependent on any other txs when it entered the mempool
 
+    // Information about descendants of this transaction that are in the
+    // mempool; if we remove this transaction we must remove all of these
+    // descendants as well.  if nCountWithDescendants is 0, treat this entry as
+    // dirty, and nSizeWithDescendants and nFeesWithDescendants will not be
+    // correct.
+    uint64_t nCountWithDescendants; //! number of descendant transactions
+    uint64_t nSizeWithDescendants;  //! ... and size
+    CAmount nFeesWithDescendants;  //! ... and total fees (all including us)
+
 public:
     CTxMemPoolEntry(const CTransaction& _tx, const CAmount& _nFee,
                     int64_t _nTime, double _dPriority, unsigned int _nHeight, bool poolHasNoInputsOf = false);
-    CTxMemPoolEntry();
     CTxMemPoolEntry(const CTxMemPoolEntry& other);
 
     const CTransaction& GetTx() const { return this->tx; }
     double GetPriority(unsigned int currentHeight) const;
     CAmount GetFee() const { return nFee; }
-    CFeeRate GetFeeRate() const { return feeRate; }
     size_t GetTxSize() const { return nTxSize; }
     int64_t GetTime() const { return nTime; }
     unsigned int GetHeight() const { return nHeight; }
     bool WasClearAtEntry() const { return hadNoDependencies; }
     size_t DynamicMemoryUsage() const { return nUsageSize; }
+
+    // Adjusts the descendant state, if this entry is not dirty.
+    void UpdateState(int64_t modifySize, CAmount modifyFee, int64_t modifyCount);
+
+    /** We can set the entry to be dirty if doing the full calculation of in-
+     *  mempool descendants will be too expensive, which can potentially happen
+     *  when re-adding transactions from a block back to the mempool.
+     */
+    void SetDirty();
+    bool IsDirty() const { return nCountWithDescendants == 0; }
+
+    uint64_t GetCountWithDescendants() const { return nCountWithDescendants; }
+    uint64_t GetSizeWithDescendants() const { return nSizeWithDescendants; }
+    CAmount GetFeesWithDescendants() const { return nFeesWithDescendants; }
+};
+
+// Helpers for modifying CTxMemPool::mapTx, which is a boost multi_index.
+struct update_descendant_state
+{
+    update_descendant_state(int64_t _modifySize, CAmount _modifyFee, int64_t _modifyCount) :
+        modifySize(_modifySize), modifyFee(_modifyFee), modifyCount(_modifyCount)
+    {}
+
+    void operator() (CTxMemPoolEntry &e)
+        { e.UpdateState(modifySize, modifyFee, modifyCount); }
+
+    private:
+        int64_t modifySize;
+        CAmount modifyFee;
+        int64_t modifyCount;
+};
+
+struct set_dirty
+{
+    void operator() (CTxMemPoolEntry &e)
+        { e.SetDirty(); }
 };
 
 // extracts a TxMemPoolEntry's transaction hash
@@ -78,14 +137,49 @@ struct mempoolentry_txid
     }
 };
 
+/** \class CompareTxMemPoolEntryByFee
+ *
+ *  Sort an entry by max(feerate of entry's tx, feerate with all descendants).
+ */
 class CompareTxMemPoolEntryByFee
 {
 public:
     bool operator()(const CTxMemPoolEntry& a, const CTxMemPoolEntry& b)
     {
-        if (a.GetFeeRate() == b.GetFeeRate())
+        bool fUseADescendants = UseDescendantFeeRate(a);
+        bool fUseBDescendants = UseDescendantFeeRate(b);
+
+        double aFees = fUseADescendants ? a.GetFeesWithDescendants() : a.GetFee();
+        double aSize = fUseADescendants ? a.GetSizeWithDescendants() : a.GetTxSize();
+
+        double bFees = fUseBDescendants ? b.GetFeesWithDescendants() : b.GetFee();
+        double bSize = fUseBDescendants ? b.GetSizeWithDescendants() : b.GetTxSize();
+
+        // Avoid division by rewriting (a/b > c/d) as (a*d > c*b).
+        double f1 = aFees * bSize;
+        double f2 = aSize * bFees;
+
+        if (f1 == f2) {
             return a.GetTime() < b.GetTime();
-        return a.GetFeeRate() > b.GetFeeRate();
+        }
+        return f1 > f2;
+    }
+
+    // Calculate which feerate to use for an entry (avoiding division).
+    bool UseDescendantFeeRate(const CTxMemPoolEntry &a)
+    {
+        double f1 = (double)a.GetFee() * a.GetSizeWithDescendants();
+        double f2 = (double)a.GetFeesWithDescendants() * a.GetTxSize();
+        return f2 > f1;
+    }
+};
+
+class CompareTxMemPoolEntryByEntryTime
+{
+public:
+    bool operator()(const CTxMemPoolEntry& a, const CTxMemPoolEntry& b)
+    {
+        return a.GetTime() < b.GetTime();
     }
 };
 
@@ -114,6 +208,71 @@ public:
  * are added to the pool: if a new transaction double-spends
  * an input of a transaction in the pool, it is dropped,
  * as are non-standard transactions.
+ *
+ * CTxMemPool::mapTx, and CTxMemPoolEntry bookkeeping:
+ *
+ * mapTx is a boost::multi_index that sorts the mempool on 2 criteria:
+ * - transaction hash
+ * - feerate [we use max(feerate of tx, feerate of tx with all descendants)]
+ *
+ * Note: the term "descendant" refers to in-mempool transactions that depend on
+ * this one, while "ancestor" refers to in-mempool transactions that a given
+ * transaction depends on.
+ *
+ * In order for the feerate sort to remain correct, we must update transactions
+ * in the mempool when new descendants arrive.  To facilitate this, we track
+ * the set of in-mempool direct parents and direct children in mapLinks.  Within
+ * each CTxMemPoolEntry, we track the size and fees of all descendants.
+ *
+ * Usually when a new transaction is added to the mempool, it has no in-mempool
+ * children (because any such children would be an orphan).  So in
+ * addUnchecked(), we:
+ * - update a new entry's setMemPoolParents to include all in-mempool parents
+ * - update the new entry's direct parents to include the new tx as a child
+ * - update all ancestors of the transaction to include the new tx's size/fee
+ *
+ * When a transaction is removed from the mempool, we must:
+ * - update all in-mempool parents to not track the tx in setMemPoolChildren
+ * - update all ancestors to not include the tx's size/fees in descendant state
+ * - update all in-mempool children to not include it as a parent
+ *
+ * These happen in UpdateForRemoveFromMempool().  (Note that when removing a
+ * transaction along with its descendants, we must calculate that set of
+ * transactions to be removed before doing the removal, or else the mempool can
+ * be in an inconsistent state where it's impossible to walk the ancestors of
+ * a transaction.)
+ *
+ * In the event of a reorg, the assumption that a newly added tx has no
+ * in-mempool children is false.  In particular, the mempool is in an
+ * inconsistent state while new transactions are being added, because there may
+ * be descendant transactions of a tx coming from a disconnected block that are
+ * unreachable from just looking at transactions in the mempool (the linking
+ * transactions may also be in the disconnected block, waiting to be added).
+ * Because of this, there's not much benefit in trying to search for in-mempool
+ * children in addUnchecked().  Instead, in the special case of transactions
+ * being added from a disconnected block, we require the caller to clean up the
+ * state, to account for in-mempool, out-of-block descendants for all the
+ * in-block transactions by calling UpdateTransactionsFromBlock().  Note that
+ * until this is called, the mempool state is not consistent, and in particular
+ * mapLinks may not be correct (and therefore functions like
+ * CalculateMemPoolAncestors() and CalculateDescendants() that rely
+ * on them to walk the mempool are not generally safe to use).
+ *
+ * Computational limits:
+ *
+ * Updating all in-mempool ancestors of a newly added transaction can be slow,
+ * if no bound exists on how many in-mempool ancestors there may be.
+ * CalculateMemPoolAncestors() takes configurable limits that are designed to
+ * prevent these calculations from being too CPU intensive.
+ *
+ * Adding transactions from a disconnected block can be very time consuming,
+ * because we don't have a way to limit the number of in-mempool descendants.
+ * To bound CPU processing, we limit the amount of work we're willing to do
+ * to properly update the descendant information for a tx being added from
+ * a disconnected block.  If we would exceed the limit, then we instead mark
+ * the entry as "dirty", and set the feerate for sorting purposes to be equal
+ * the feerate of the transaction without any descendants.
+ *
  */
 class CTxMemPool
 {
@@ -141,6 +300,31 @@ public:
 
     mutable CCriticalSection cs;
     indexed_transaction_set mapTx;
+    typedef indexed_transaction_set::nth_index<0>::type::iterator txiter;
+    struct CompareIteratorByHash {
+        bool operator()(const txiter &a, const txiter &b) const {
+            return a->GetTx().GetHash() < b->GetTx().GetHash();
+        }
+    };
+    typedef std::set<txiter, CompareIteratorByHash> setEntries;
+
+private:
+    typedef std::map<txiter, setEntries, CompareIteratorByHash> cacheMap;
+
+    struct TxLinks {
+        setEntries parents;
+        setEntries children;
+    };
+
+    typedef std::map<txiter, TxLinks, CompareIteratorByHash> txlinksMap;
+    txlinksMap mapLinks;
+
+    const setEntries & GetMemPoolParents(txiter entry) const;
+    const setEntries & GetMemPoolChildren(txiter entry) const;
+    void UpdateParent(txiter entry, txiter parent, bool add);
+    void UpdateChild(txiter entry, txiter child, bool add);
+
+public:
     std::map<COutPoint, CInPoint> mapNextTx;
     std::map<uint256, std::pair<double, CAmount> > mapDeltas;
 
@@ -156,7 +340,13 @@ public:
     void check(const CCoinsViewCache *pcoins) const;
     void setSanityCheck(bool _fSanityCheck) { fSanityCheck = _fSanityCheck; }
 
+    // addUnchecked must updated state for all ancestors of a given transaction,
+    // to track size/count of descendant transactions.  First version of
+    // addUnchecked can be used to have it call CalculateMemPoolAncestors(), and
+    // then invoke the second version.
     bool addUnchecked(const uint256& hash, const CTxMemPoolEntry &entry, bool fCurrentEstimate = true);
+    bool addUnchecked(const uint256& hash, const CTxMemPoolEntry &entry, setEntries &setAncestors, bool fCurrentEstimate = true);
+
     void remove(const CTransaction &tx, std::list<CTransaction>& removed, bool fRecursive = false);
     void removeCoinbaseSpends(const CCoinsViewCache *pcoins, unsigned int nMemPoolHeight);
     void removeConflicts(const CTransaction &tx, std::list<CTransaction>& removed);
@@ -178,6 +368,33 @@ public:
     void ApplyDeltas(const uint256 hash, double &dPriorityDelta, CAmount &nFeeDelta);
     void ClearPrioritisation(const uint256 hash);
 
+public:
+    /** Remove a set of transactions from the mempool.
+     *  If a transaction is in this set, then all in-mempool descendants must
+     *  also be in the set.*/
+    void RemoveStaged(setEntries &stage);
+
+    /** When adding transactions from a disconnected block back to the mempool,
+     *  new mempool entries may have children in the mempool (which is generally
+     *  not the case when otherwise adding transactions).
+     *  UpdateTransactionsFromBlock() will find child transactions and update the
+     *  descendant state for each transaction in hashesToUpdate (excluding any
+     *  child transactions present in hashesToUpdate, which are already accounted
+     *  for).  Note: hashesToUpdate should be the set of transactions from the
+     *  disconnected block that have been accepted back into the mempool.
+     */
+    void UpdateTransactionsFromBlock(const std::vector<uint256> &hashesToUpdate);
+
+    /** Try to calculate all in-mempool ancestors of entry.
+     *  (these are all calculated including the tx itself)
+     *  limitAncestorCount = max number of ancestors
+     *  limitAncestorSize = max size of ancestors
+     *  limitDescendantCount = max number of descendants any ancestor can have
+     *  limitDescendantSize = max size of descendants any ancestor can have
+     *  errString = populated with error reason if any limits are hit
+     */
+    bool CalculateMemPoolAncestors(const CTxMemPoolEntry &entry, setEntries &setAncestors, uint64_t limitAncestorCount, uint64_t limitAncestorSize, uint64_t limitDescendantCount, uint64_t limitDescendantSize, std::string &errString);
+
     unsigned long size()
     {
         LOCK(cs);
@@ -209,6 +426,48 @@ public:
     bool ReadFeeEstimates(CAutoFile& filein);
 
     size_t DynamicMemoryUsage() const;
+
+private:
+    /** UpdateForDescendants is used by UpdateTransactionsFromBlock to update
+     *  the descendants for a single transaction that has been added to the
+     *  mempool but may have child transactions in the mempool, eg during a
+     *  chain reorg.  setExclude is the set of descendant transactions in the
+     *  mempool that must not be accounted for (because any descendants in
+     *  setExclude were added to the mempool after the transaction being
+     *  updated and hence their state is already reflected in the parent
+     *  state).
+     *
+     *  If updating an entry requires looking at more than maxDescendantsToVisit
+     *  transactions, outside of the ones in setExclude, then give up.
+     *
+     *  cachedDescendants will be updated with the descendants of the transaction
+     *  being updated, so that future invocations don't need to walk the
+     *  same transaction again, if encountered in another transaction chain.
+     */
+    bool UpdateForDescendants(txiter updateIt,
+            int maxDescendantsToVisit,
+            cacheMap &cachedDescendants,
+            const std::set<uint256> &setExclude);
+    /** Update ancestors of hash to add/remove it as a descendant transaction. */
+    void UpdateAncestorsOf(bool add, txiter hash, setEntries &setAncestors);
+    /** For each transaction being removed, update ancestors and any direct children. */
+    void UpdateForRemoveFromMempool(const setEntries &entriesToRemove);
+    /** Sever link between specified transaction and direct children. */
+    void UpdateChildrenForRemoval(txiter entry);
+    /** Populate setDescendants with all in-mempool descendants of hash.
+     *  Assumes that setDescendants includes all in-mempool descendants of anything
+     *  already in it.  */
+    void CalculateDescendants(txiter it, setEntries &setDescendants);
+
+    /** Before calling removeUnchecked for a given transaction,
+     *  UpdateForRemoveFromMempool must be called on the entire (dependent) set
+     *  of transactions being removed at the same time.  We use each
+     *  CTxMemPoolEntry's setMemPoolParents in order to walk ancestors of a
+     *  given transaction that is removed, so we can't remove intermediate
+     *  transactions in a chain before we've updated all the state for the
+     *  removal.
+     */
+    void removeUnchecked(txiter entry);
 };
 
 /**