Bitcoin Forum

Now that the SEC has rejected the Winklevoss bitcoin ETF, I decided to actually glance through their S-1 (registration statement) that they filed with the SEC just for the heck of it. The S-1 requires a statement and discussion of possible risks associated with a security that is seeking SEC registration. In the Winklevoss S-1, I found this section particularly noteworthy (emphasis is original):


Not only is this a risk that they highlighted, my view is this is inevitable, and that mining fees will eventually become prohibitive not only to bitcoin expansion, but everyday bitcoin function. This is the flaw that will eventually render bitcoin unusable for everyday commerce, and the price will decline accordingly as demand for coins falls off as a result.

Mining fees will eventually kill bitcoin, the question is if this is avoidable with some type of change, or a predetermined fate that cannot be altered due to the nature of the ecosystem?

The fees are getting more and more expensive everyday!

Just today, i sent 3.77 usd and the bitcoin core client wanted 0.50 cents, that's ridiculous for 3.77

i created my own fee and the fee turned out to be 0.07, it's been 7 hours and no confirmations yet,

im not worried, i think eventually it will go through, and i wanted to test it to see how long it would take,

but yes, bitcoin would not work for small transactions for stores and between strangers, its too slow

i know the 0.50 cent fee would of been super fast, but it's way to expensive,

i remember when there was free fees and it was fast,

i have no problem if there is no free fees, i don't mind paying fees, to support the bitcoin technology because the transactions fees help the miners, but it is getting way out of control

i don't think bitcoin will go down that easy, it's still very convenient to transfer lots of money, millions,
 
i'm not ready to give up on bitcoin yet, but i hope they fix things, or yes it could kill bitcoin

I know about that, if 0.50 cent looks too expensive just for the below $4 transaction. But can you provide your txid? Or have you tried for using the transaction accelerator? More adoption and more transaction with the limit bandwith for the block to catch and validate the transaction and i think this thing will be resolve in the future. I don't know about the exact date but if the drama of bitcoin developer has ended and they are come with new scalable answer.

.50 for a transaction under $4 damn thats crazy, need to get that under for control.

Transaction fees are a necessary part of Bitcoin and without them, Bitcoin would lose it's most useful, unique properties and thus, it's value.

The resources required to facilitate censorship-proof transfer of value and a seize-proof store of value are quite expensive.

Since the dawn of Bitcoin, this cost was paid for through inflation (new coins entering the market through the coin base reward were given to those who used resources to secure the network).

At time passes, the inflation rate (supply of new coins) continues to be cut in half (so that Bitcoin isn't constantly inflating at a rate which would erode it's value).

Yet, the network still has costs to maintain.

Transaction fees paid for by those who enjoy Bitcoin's properties will slowly take the place of the coin base reward as a means to pay for the security of the network.

As more people come to value Bitcoin's unique properties, there will be more competition to have transactions written into the permanent ledger in a timely manner, and fees will increase.

Some users have grown used to the block reward subsidy paying for the utility which Bitcoin provides and will have to be dragged kicking and screaming into the future if they want to continue to enjoy Bitcoin's unique and useful properties.

Could the processing that's done by miners be coded into the activity that blockchain takes in the transaction? There's nothing unique from one miner to the next, they're just verifying the transaction...doing the math, so to speak. If it's just math it can be coded and automated and set free for the world.

Evolution has occurred with all great advancements in society, Bitcoin is not immune to that eventuality and the idea of bitcoin is strong enough to generate the inspiration required to make that evolution reality.

If I'm being super naive here, let's talk...I want to learn!

that is a lot of "may" and the chances for them are pretty small.
by 2020 block reward will go from 12.5BTC to 6.25BTC and by then two things will happen and there is a high possibility for them. price will be higher and also more advanced mining equipment will be created with better efficiency. people always forget about hardware advances! and this means there would still be no need to increase fees to cover mining cost.
save goes for 2024(?) 3.125BTC and so on.

but yeah. i fully agree that if fees go up, at some point people will stop using bitcoin. and although some people find it hard to accept but it is a truth. and eventually it can turn bitcoin into something only whales who don't care about paying for example 0.1BTC fee use to move their 1000BTC around.

Well, that mining fees have two side. It has positive side for miners and gaves them stimulus to mine and mine because nowdays transaction fees are so high that mining rewards are high now. So for bitcoin users, which use bitcoin for payments, than fees are very bad. Nowdays I have to send minimum transaction with at least 0.0006 btc fee to receive it normally.
I agree you, that fees aren't attracting people, they are worst.

Mining fees will not kill bitcoin. The higher the price of bitcoin and the more users using bitcoin the difficulty in mining has increased. The miners fee are just normal and must be implemented otherwise id mining industry will stop then bitcoin will die instead. If the miner fees are high then lets dont send small amount of bitcoin several times but send a large amount of bitcoin in one go that way you can save.

are we sure that a currency need fee? couldn't be done in another way i see that there is this coin called railblock, that has no fee for miners that only need to act when doing a transaction(not continuos mining)

the distribution is based on captcha there, not the best one i guess, it can be improved, but still transaction are confirmed instant and there is not a single fee

I don't think its killing bitcoin although it may shy away potential bitcoin users because of the increasing mining fee. Although as shield132 pointed out, the fee is somewhat becoming more attractive to miners to continue mining. But this is causing concern among bitcoin enthusiast, the increasing demand for faster transactions has also led to a drastic rise in the miner fee associated with each transfer. I guess, the increasing fee is currently an integral part of bitcoin ecosystem unless a solution has made been to alleviate the currrent crisis.

about sending fee and estimate time to confirmation transaction you can read in here https://bitcoinfees.21.co/
sending fee not about how sending bitcoin balance you sending, but how much block size youre sending

Transaction scarcity and increased fees will not kill bitcoin but they will kill some of its utility, using bitcoin as a means of payment and any micro transactions on chain, like colored coins will be priced out.

Merchants are already dropping bitcoin because no one wants to deal with all the 'transactions are not confirming' problem, it's a lot of support tickets that need to be taken care of and that costs a lot of money, accepting bitcoin as payment will end up more expensive than other payment methods.

If Bitcoin will continue to rise in price it is not necessary that the fees will rise as some think they will. It will be enough reward for miners to continue their work without rising fees.

But I agree that right now the situation for small transactions is looking strange. Paying $0.5 to send $3 is really a lot.

I agree, the fee now is very expensive and there are a lot of people stop using bitcoin because the fee is too high, they prefer to choose another type of payment, if this keep continue it will kill bitcoin, because nobody want to pay 0.5$ for 3$ transaction, the fee is more than 15% of the transaction

Yes,its a matter of serious concern.With your fees as 0.07 cents, in my experience,i think it will take 6 days for your transaction to be processed.Thats ridiculous.The main feature of bitcoin,i.e., the low transaction fees has been compromised.

update!!

I woke up this morning and it has gone through,   it is currently at 73 confirmations

So i'm guessing it took about 16 hours to go through, still pretty damn fast compared the banks, and cheaper

Bitcoin is still King!


so for small transactions that i am not in a rush, bitcoin still rocks!

considering the donation i gave was from a country outside my country,

if i tried via the bank, it would cost me 30 bucks to transfer the money to another country,

and probably 2 weeks, not counting the exchange rate

i can easily adjust the fees i want to pay as long as i am willing to wait,  0.07cents for 3.77 i think is fair


Like i said, Bitcoin won't go down that easy, its still extremely convenient

I think Bitcoin will continue to go up and up!  1,246usd per bitcoin, this is just the beginning

we're going to be able to purchase a home with a single bitcoin someday

glad i got at least 1 bitcoin stored offline

long live bitcoin!

Bitcoin works fine, but to reach mainstream status we need offchain transactions, otherwise its impossible. I dont see other way out but leave the blockchain as a settlement of offchain transactions, yes not ideal, but we have no other way out.

This is in blockchain is getting bigger of the fees when you send estimated of 10$ they will automatically reduce 1$ of it in fees so why coins will be acceptable whether i sent it to be honest im using our based web wallet here in my country even the price is not accurate on preev.com but whether you want to send its free and when you want to withdraw its also free.

Mining fees will not eventually kill bitcoin because they are not that big and they are now getting lower in numbers. It doesn't make thise transacting at mining to be profitable to them and even those investing to a reliable sources decline back and stop transaction with them, because most of them were scam.

Protip: Internal transactions are free, off-chain, and instant on LocalBitcoins exchange.

High mining fee may not kill Bitcoin but it will make its users to look for alternative.  As far as I know the fee can be fixed by creating a standard fee and code it to Bitcoin program.  I know the possibility of encrypting the code with fix tx fee (in USD value) can be done.  If we let the miner  decide what fee is the standard fee then we can even see 1 Bitcoin being the standard fee and that is insane.  I can see in a merchants view that having this fix fee is attractive and the confirmation will be first come first serve basis to those who comply which  I think is the best way.

Yes, the mining fees are getting more and more expensive day by day and we must find any concrete solution for it otherwise, it will reach the level of what other fiat companies are charging today. The core benefit of bitcoin is that it is (still) cheaper than other payment options in terms of transaction costs and it needs to remain under control.

Oh man I can feel the birth of another coin that will replace bitcoin in the mainstream. Or maybe it already exists.

I don't think you understand the concept of transaction fees.  You still have to send your Bitcoin to LocalBitcoins and withdraw it, and as long as your Bitcoin is online it's never 100% safe as we learned with MtGox.

Bitcoin transactions shouldn't all be about exchanging it for fiat, otherwise Bitcoin would be pointless.

Knowing that the fees will keep getting bigger and bigger, people can trade bitcoins but sooner or later they will swicth into another altcoin wit low cost option, soo bitcoin will start to loose slowly some investement, this is good to crypto world since there are a lot altcoins with potencial and growing like dash jump recently.

Its actually a call for concern and attention that the amount of bitcoin is going through the roof where part of the reason bitcoin is making waves over other mode of transferring currencies across borders but the issue that it will kill bitcoin is what I wont fully subscribed to in the sense that as bitcoin price is increasing so like wise the transaction price is increasing and also compared to other means of transferring funds, it still offered the cheapest which is acceptable across board...

It depends on what we view as the nature of Bitcoin, will Bitcoin be used as a currency with a fixed supply and transactions breaking down into hundreds or thousands of satoshis or do we need to keep the value relative in only the first few digits. We can still break down bitcoin into multiple digits even if the price rises after all.

Or will we treat it as an asset-class that is a representative base index on which we base the price and value of all other cryptocurrencies upon as it does now when we price it on exchanges.

In terms of mining fees this is putting the cart before the horse in order to propel further growth it is inevitable that mining fees will decrease to increase user adoption as well as the block reward..

However in exchange we will see price appreciation and increased utility as all technologies related to Bitcoin and Blockchain technology develops and investment and capital is put into the sphere.

Stopping and slowing the number of transactions on the main chain just means that the incentive for side chains to do that same function grows. So is it a risk to Bitcoin perhaps if we hard-fork because there will be no base price for which other altcoins will be priced against in the period Bitcoin-A and Bitcoin-B exist. The more Bitcoin is worth, the more worthless it is as a currency.

The community will decide the path hard-fork to transactions and treat Bitcoin as a currency, soft-fork but keep mining fees consistent or something else.

There so many reason why this will not happen, but one of them is the fact that bitcoin will increase in price over time.  lets say for example that a bitcoin was worth $10,000, and i want to send it to a Lightening wallet to use in commerce, or whatever.  the fee is $10 which would be reasonable for securing a $10,000 transaction.  The amount of transaction fees that miners would get with every block would be massive and would more than pay for mining.  And also never underestimate the intelligence of human beings who need to solve a problem.

Well sooner or later the miners would have to rely on transaction fees instead of block rewards to keep things going. I don't think the high tx fee and the resulting increase confirmation time would be enough to kill bitcoin though. People would still buy into it for profit potential because of the price fluctuations and by extension, for value storage. What the tx fees might kill though would be microtransactions. It seem to be small enough to still use bitcoins for remittances abroad but as for using it to buy stuff, it may no longer be convenient. I've read that in some areas online wallets offer debit cards and those are better for daily use but I don't have them yet. If that would at least reduce the wait, then that might be the way to go for microtransactions.

yes i am also not in favour of increasing the mining fee. i also think that this problems must of solve on priority basis include the bitcoin transaction fee also.

If we are expecting bitcoin to be used on a local level then mining fees must be small and confirmation time must be less in order to the local level adoption. No one would pay 10% or something miner fees because many items are available at the price of miner fees so why would someone use bitcoin to pay more charges and time?

I think it can eventually do tgat if we don't act fast and get the fees down. Imagine explaining Bitcoin to a newbie after all these complications then you tell him the transaction fees are similar or a little bit lower than say PayPal, don't you think he will end up staying with what he knows than trying anything new. It's going to hurt the community so I'm calling for a change and likewise a change in confirmation times.

Welcome to real life, bro

This is called a bottleneck. Everything should come (or fail to come) through it to move further. Humanity itself had passed through such a bottleneck in the past as well (and likely not just once). And it seems highly likely that Bitcoin will soon get into something similar since its mining model is not sustainable in the long run (as per your post). It is just outright flawed since we see how miners reject the updates that would not just efficiently and effectively solve this very issue (of surging mining fees) but also allow to make a huge step or even jump forward in Bitcoin evolution and development as such. So it is either Bitcoin will end up abandoned and Bitcoin miners along with it or miners themselves as we know them today should be gone for good. They are contrary to the idea of money itself. Money should facilitate trade, not hinder it. So miners should be gone

yes that is a fact. actually these are the small problems that are creating bad impact on the future of bitcoin. i think bitcoin will become more and more reliable and people will put more and more trust on bitcoin when these minors problems will be solve.

This topic is true and a threat for bitcoin because this could happen if this kind of thing will continue to happen. Mining fees or transactions fees are keep on rising up and its becoming more expensive than before and if that continues then users will find more affordable coin and it will eventually kill bitcoin from losing users or investors and also the volume in the market.

https://bitcoinfees.21.co/
It's really high. That makes me use the off chain transaction.

https://blockchain.info/unconfirmed-transactions
No more than 20k transaction and it makes redicilous about the result of the reliable transaction fees.

I think that a good solution to this would be to have price reductions, or rather, prices including fees. Starbucks does this with taxes; rather than saying $3.25 + tax or $3.25 with a surprise tax at the end, they simply have $3.45 as the price. This makes it easier for the consumer to see the worth and I think if it would be possible to have the same thing for bitcoin transactions it would work out really well.

That's the worst idea that could ever be proposed

And I hope that it will never get implemented. The problem is not that miners are more and more dependent on transaction fees and thus they are hell-bent on raising the fees without particularly choosing betwen the tools to get there (e.g. flooding Bitcoin network with spammy transactions to cause artificial jams). The whole idea of fixing fees is counterproductive for Bitcoin in and of itself. It is like firmly setting the Bitcoin price against the US dollar. The fees should be determined by the free market, but that should be a free market after all, not a mining oligopoly (as what we effectively have today)

I guess, the value of bitcoin will increase further since there will be less mining.  :-\

Its been pointed out that transactions are the main problem, It seems that paying a higher fee magically increases the speed of the transaction,  I guess because it prioritizes them first over others.  In that case they will continue to increase as more transactions happen and more people want things moved around faster.

they are higher than ever, 50k satoshi on average per transaction is huge, it's more than $0.5 and that is only the average, many people are paying already above $1 per transaction, how cna you say that this is small

currently miners are earning something like 1 whole btc added to their block reward, their block reward is basically 13.5 btc now


it's common misconception that are miners increasing the fee, it's actually the user that by wanting to be first among other is paying more, the more you pay the higher is your transaction priority against other,

this is happening because of the limitation of the block, and this why bitcoin will not die because of fee increase

no kill.
Now bitcoin price quite high.
 Just logically think if u are miner, u seen bitcoin price up, u will think to up fees or not?

This is a good thing to encourage them to mine. Of course not good to us because high fee.

Don't take for granted. If people not mine, our transaction will be congested.

 

This is not a misconception, by any means

It looks more like it is you not caring or wanting to look deeper into the matter. So before aggressively hitting the Quote button, honestly answer just two questions. First, are users interested in paying more fees to miners? And second, are miners interested in users paying more fees to them? If the answer to the first question is negative while to the second positive, think again before hitting that button. Perhaps, it is you after all who is misunderstanding something here, and it is actually miners who are making the users pay higher transaction fees (whether the latter like it or not)

Yes, I agree. I think it will all be just fine. And although amount is not increasing partly because the price grows, the fee is supposed to decrease with each halving, because smaller sum will be mined and thus smaller will get stuck between the blocks. At least from what I've been watching on btc this seems correct.
Perhaps I misunderstood some stuff though.

It seems to be the case

Mining rewards as such are inconsequential to the average size of a transaction fee since the size of the reward doesn't affect the number of transactions, which seems to be the root of your confusion (it would still take only 1 transaction to receive the reward). The transaction fee (in dollar terms) is obviously in positive correlation with Bitcoin price, and this correlation should be quite close to 1. On the other hand, it could still be claimed that diminishing miner rewards would make miners look for ways to collect more fees (to compensate for the drop in rewards), and with the same block size that could be done only by raising an average fee per transaction. So in reality it will likely work opposite to what you think, i.e. fees will rise, not decline with less rewards

It depends on if Core devs can get it through their skulls that the block size needs to increase. The current people manipulating market price prefer steady volume, high mempool, "high frequency" trading. Prices can't be controlled profitably if the volume increases. On the positive side, spam and churn behavior have been taxed and reduced by fees.

The ETF would have helped the price shillers by reducing supply. I suspect the bitcoin mempool would've instantly buckled if the Twinkle Towers ever did go live with ETF trading. Good riddance,

Lightning Network is way too "hypothetical future" and likely unsound or just lame. Another geek turkey fest.

Mining fee is what motivate the miners to keep mining for traders and generally transactions bitcoin are made possible through activities of miners. So without mining no bitcoin and without bitcoin no transactions and without transactions no fee to pay.

Even worse: it's now the default setting of many wallets to "use the best fee". That means most people now just pay more. Paying more doesn't solve the fundamental problem: blocks are too small. In the end this means the high fee still isn't enough, so the next day you'll have to pay more again. Fees have been spiralling up for quite a while now.
0.5 mBTC fee is common now for a small transaction, which is (in dollars) about 50 times more than I used just over a year ago. Unfortunately, I can only conclude this is limiting Bitcoin's growth potential.

You're going at this the wrong way. More fees means more competition for miners, higher hash rate, paying more on new hardware and electricity. You could argue it becomes harder to do a 51% attack, but in the end it only leads to more competition for miners.
If there would be only 1 miner, happily mining on his CPU, blocks could handle exactly the same amount of transactions. We don't need more miners to process transactions, that doesn't change how many transactions Bitcoin can handle at all.

As to me, this is an absurd situation

Generally, to claim that higher fees lead to more competition between miners, you have to solve the following dilemma, i.e. to explain how it is possible that users are competing between themselves for the inclusion of their transactions in the new block by increasing the amount of money they are willing to pay for that, and at the same time (as you claim), the competition between miners rises as well. I guess you can't have it both ways at the same time in a free market

But maybe this isn't a free market because the blocksize has been artificially retarded by the Core Politburo? That could certainly cause fees and miner competition to go up simultaneously... Hmmm.

Mining is very simple: if it's worth the investment, you can start mining! Google for a "mining calculator", and you get an estimate on the return for a certain hash rate.
If the turnover per block goes up, miners earn more money in the short term. Longer term, it will lead to new investments, which will lead to an increase in hash rate, which means a new equalibrium is found until it's not profitable to invest anymore for new actors to join.
It's basically standard market economy.

Then if it is the users why does there are fees that were ignored?  And we can see that there is always an update of the standard fee that can be accepted?  Who then set these fees?  I use electrum and using it with dynamic fee auto adjust the fee and I noticed it is ever increasing.

Let's learn it from the example,

There were 10 billboards in the city and 10 advertisers. The billboard holders decided to charge $1 per day for the billboard. Every advertiser was happy with one billboard by paying $1 for it.

Now, 100 foreign companies entered the town (Because Trump was not the mayor, lolz) in the year and they started approaching billboard holders to put their advertisements on the billboard.

The billboard holder said he will charge the same rate as usual to everyone but those who want to put their ads on the priority basis will have to pay extra priority charges. He was charging $1 (the same rate for advertising) but he was giving more priority to those companies willing to pay more priority charge (depending on the compititiors offer for the same).

In the same way, miner fees are the same for confirmation but since some users are paying high fees (priority charge) for their transactions, usual transactions are getting delayed confirmation.

Yes, this is very much the point I was making. As new coin originations fall, miners will demand more fees to supplement the income they need to continue mining. This will lead to a dramatic increase in the fees in bitcoins, and also make transactions cost-prohibitive in dollars. I would think this would cause a decrease in demand for bitcoin when it becomes too expensive to transact with, and thus, a fall in the price.

Essentially, miners serve two functions, they verify transactions while propagating the network. The miner who "solves" each block gets to include whichever transactions in the block he wants. Obviously, to maximize his own reward, he will choose the transactions that have the highest fees/byte. This is why over time, mining will get more expensive and the fees it takes to get your transactions into a block will increase. If you don't pay a high enough fee, you'll constantly be line-jumped by everyone willing to pay more. This is a free-market system, but not a cost efficient one.

How is it the miners causing this? It seems to be the inevitable outcome of a truly fair market system where a limited number of transactions can be processed at any one time. Competition over a limited amount of block space is what determines the price of the transaction fee. If all the payers refused to pay a fee above 20 sats/byte, miners would have no choice but to accept that as the fee because nothing else is available. Because there is competition for this limited space, and people willing to pay more to essentially line jump, the miners aren't causing the price to rise, they're just reaping the reward from it. The limited space in the block and competition for a slot in it is what is causing transaction fees to rise as transaction volume creates more congestion to compete against.

I've always thought that mining fees were going to be the future of bitcoin?

I mean sure, they are a bit too high right now for bitcoin to be competitive. Remember how we used to say "bitcoin compared to Paypal and Perfectmoney transaction fees of 2% each transaction is so good"? Well now we are losing that competitive edge.

But still, as mining rewards drop in the future the most important method of income will be through the transaction fees people pay to get their transactions confirmed. I think that if the fee keeps increasing as is the price, then bitcoin has no future.

This is an oversimplified view on the "standard market economy"

Before anything, if the amount of profit obtained per block goes up, that should necessarily cause the fees to drop, nor rise (in a free market). I guess this is the first thing that should happen if there were a genuine competition between miners. In other words, more profits first increase the competition among existing miners (and only later new miners join in). The reason for this is that miners aim at earning certain margin, if this margin goes up, the competition increases and the margin goes down to its typical level. But it can go down only through lowering fees provided the number of transactions remains more or less the same (which seems to be the case here). But the latter should lead to cancelling out the competition between users (this competition is causing the rise in fee amount they have to pay). To put it differently, both of these things cannot exist simultaneously. That's what my point basically comes down to


The main issue with your example is that there may not be any real new foreign company in the town, i.e. the number of transactions seems to be artificially increased via flooding the network with spammy transactions. Really, why would people want to transact more if the fees have risen?

While I do agree that mining fees can kill Bitcoin due to the fact that it will eventually suck out all of our money, I don't think that it will be the death of Bitcoin.

The mining fees really depend on the user base existing within the Bitcoin community, and the overall competition to receive/send their money quickly. As the user base grows, the demand for mining efficiency grows along with it. Therefore, the prices will increase as well. Of course, there are plenty of other factors that relate to this issue.

In this case, though, I recommend you just change the fee that you pay. That's what I do anyway. Of course, I don't want my payment to become static and never move, thus I try to increase the fee to about 5000 satoshi per payment. It usually takes a couple of hours to process which isn't terribly long. But, I'll admit, there needs to be a solution to the problem. Sooner or later our low fee transactions are going to take days to process and people will flock to sell their Bitcoins. In such a case, we may never see this "honeymoon" period in BTC value ever again.

This is already happening. I tried to send a transaction of 0.001 BTC with a 5000 satoshis fee and I couldn't complete it. After more than one week the satoshis came back to the wallet, operation canceled. If the technology doesn't evolve to support more transactions at same time it will become even worse. And transaction spammers will always exist, principally if someone wants to sabotage Bitcoin.

LOL, that's really shit. The miners are too greedy to take more fees from every transaction. It looks like they are not care about the bitcoin scalability problem and try to vote on the wrong way and it means killing the bitcoin in the future. I don't agree with your opinion.

This means Bitcoin is coded to Transaction fee war, which can be fixed if the Developer are so keen about the possibility of the thing that is happening right now.  But well I can say developer are developer and probably they lack knowledge about economics.  Aside from that they only base their codes according to their current country's situation and pricing ignoring the other part of the world that even a cent cost a fortune for them.

I guess, if only they implement a first sent, first serve method, there will be no confirmation that will be unconfirmed for several days.

That's right. Many participants of the site explain bitcoin as the way to skip that kind of fees that we usually pay for money transfer. But actually all this sites that work with bitcoin are taking their fees as well. And unfortunately there are not so many places here that would work with bitcoin directly. So every time the process of turning bitcoin into fiat takes from me like 10% and it's a lot.

See my post above

You seem to be (likely erroneously) assume that we have a truly fair market system. While your logic looks to be pretty consistent, your basic premises appear to be wrong (i.e. a free market existing). There was a thread recently about some mining pool deliberately not filling up found blocks with mempool being overfilled. That pretty much tells it all. If there were a truly free market in respect to mining (with hundreds of independent miners), such actions would make absolutely no sense since transactions not included in this block will be included in the next block found by another miner. But just because there would be plenty of miners, they would be massively disincentivized to act like this miner does, By doing that (i.e. pushing half-empty blocks), such miners would be shooting themselves in the foot. They would be just giving away transaction fee profits to other, less rogue miners. But since this is not a free market at all (with only a dozen of miners processing 99% of all transactions), the free market laws fail miserably here

We all knew fees would play a paper once all coins full mined, we didnt know we would have to start paying bigger fees now to miners proces the same transactions as they made in the past since now each satoshis has much more value. It were to keep the same fees or atleast reduce the fee, but looks like miners wanna go other way, and those might damage a lot bitcoin.

What to do ? Everyone is working for their own benefits and hence miners too.
Actually with bitcoin prices above $1200 levels, we must have transaction fees lesser than 10k satoshi. But we are being forced to pay 10 times more fees. It is really pathetic situation like how miners of blocking scalability of block size.

The block size and mining fees are highly interrelated, I believe both will get resolved in our favour way in very near future. Because this is how a decentralized system should work.

The fees is not determined with the valuation in dollars and when all the coins are mined transaction charges will be the only incentives they have to keep on running the huge farms and in the mean time it wont be that profitable and the possibility that the fees will increase in the future is imminent unless and until the core developers find a solution for all these issues.

This would happen in a free market. If it becomes cheaper to produce bicycles, sales prices can go down.
But Bitcoin transactions are scarce. Unlike new bicycles, users have to compete with eachother.

If blocks wouldn't be full, it would make perfect sense to pay a lower fee (measured in Bitcoin) if the Bitcoin-price (measured in USD) goes up.

Suppose Bitcoin could handle 8 times more transactions. Fees would be lower, but more transactions means more fees anyway. And more importantly: Bitcoin could facilitate 8 times more users, which means the price could go up an order of magnitude. How can miners not see this?

You got my point absolutely wrong

First of all, Bitcoin transactions cannot be scarce by definition, otherwise blocks wouldn't be full (according to your logic). There is an outright contradiction in these few sentences above, i.e. transactions are scarce while blocks are full (that's an impossible combination). Further, I don't mind if you quote part of my posts (as long as you don't get that part completely out of context and distort the meaning of the whole post), but in this case, I explained it elsewhere in my post that the transaction jam is artificial and intentional. I even mentioned a thread about some mining pool consistently not including half of the transactions leaving their blocks half empty lately. With mempool now being chronically overcrowded, there is only one plausible explanation behind that. You guess what

Maybe we have a different definition of the word "transaction". When I say "transaction", maybe I should have used the word "confirmed transaction". It's not that Bitcoin has a lack of people wanting to make transactions, the scarcity limits the number of possible transactions that can be confirmed.

you need a large fee to get the trasaction and confirmation that fast. I think this has strayed far from the tagline bitcoin with cheap and fast fee like some years before? lol

I don't quite agree with your usage of the term scarcity in respect to confirmed transactions, but let's use that. And what makes you think this "scarcity" is not created deliberately to raise fees even higher? Basically, you are trying to explain things from a free market point of view when there is no such market, to begin with


As I said above, the free market outlook cannot be applied here for the lack of this market in the first place

So your base assumption is erroneous. There won't be many more transactions, therefore increasing block size will just reveal the miners' wrong-doing. Apart from that, I'm heavily inclined to think that the number of valid transactions (i.e. not spammy ones, probably generated by miners themselves) are decreasing overall. Not because Bitcoin user base is shrinking, but simply because people are finding workarounds to escape higher fees and use services (like web wallets and exchangers) that make offchain transactions possible or just group payments to lower the total fee amount per transaction

This is due to the the problem on the bitcoin mining sector. Blocksize problem has caused tremendous problems on the network, one is the high miner fees and the other one is the long confirmation of transaction. Well to add the last probably and one of the disappointing fact is the disapproval  of the ETF due to blocksize problems.

Here  the main thing that I am thinking is that  " mining profit " .
We are  all know that mining are not much profitable now but here a big thing is that where will go the miners who are spending thier money for mining , So usually time to time the fee increases by the network of bitcoin  So that the more and more person try to make some better earning and support the bitcoin network to make the transaction much smooth .
Well here I will say that the increase in the fee is only a step to increase the future of bitcoin at a great level .
This will not kill the bitcoin future at all .

For all your ardor and enthusiasm, I think you don't quite understand how things work in respect to mining

First, we all don't know how profitable is mining, so it's no good to make such sweeping assumptions. But ultimately, this is irrelevant since mining will always remain profitable by definition. There is absolutely no need to make it look as if low mining profits somehow justify high transaction fees. Raising fees in every possible way is used to maximize mining profits, but this is possible only because the whole concept behind mining is skewed. I don't mean mining itself as a process of confirming transactions, of course. I rather mean the model behind mining which makes possible heavy centralization (read monopolization) of mining, which is what the real culprit behind miners trying to squeeze profits from every dollar spent

Mining fees are going to be a problem that we face at the moment but people are going to have to come to the conclusion that the miners are going to be needed to be compensated somehow, as the amount of new coins being generated by the bitcoin network are halving as we all know it.

This makes everything less and less profitable for the miners which in turn makes it less likely that people are going to be mining, let along spending hundred of thousands of dollars in machines that are never going to pay themselves off. The mining fees are the part that is helping to fill the gap from the halving, but I do know that this issue is going to have to be faced as no one wants to spend a huge percentage of what they're going to be buying on fees for using it.

Segwit please.

Did you ever ask yourself that these machines should not be there in the first place?

That mining as it is today is a waste of resources mostly (waste of money, time, effort and whatnot)? That you don't need all those huge mining farms to confirm transactions? That Bitcoin network security doesn't depend on how much hashing power is required to find a new block? That it depends first and foremost on the number of independent miners and that any typical computer could confirm transactions as good as any advanced mining farm out there? And that in the latter case fees would be close to negligible?

If what stated on the statement is correct then it is sure that in the coming days Bitcoin future is very bad in shape due to heavy transaction charges, so as stated it is also good for other altcoin which are having good platform which can over take bitcoin, and in that ETH is on first race to opt Bitcoin future.

Yes that line is out. But it is not bitcoin fault but ours.
Miners just need something to make them work harder. Although it is really bad and kind of greedy and also it is like giving special treatment to those who can afford. What is the difference now between bitcoin transactions and paypal or western union.
I kind of stayed here for that reason at start though it changed from time it is still not a good look.

I think the current fee situation is several years premature. The block reward still makes up the large majority of miner payment. I don't know how much fee head room is left before people start shopping elsewhere.

Some bitcoin fans act like it has already won. Maybe they'll still be here after everyone else has reached their breaking point and they'll have wonderfully cheap fees again because there won't be any transactions.

Right now everyone should be all out to on board as many people as possible. Very few have a genuine need to use it, they just want to use it and that's slowly eroding.



Whoever started that sakes pitch was very stupid. This was always going to happen but it's happening far too soon.

Yes, eventually that tagline of cheap and fast transactions is being fading because neither they are fast now nor they are cheap. The only solution I see to this problem is limiting the number of transactions people make.

For example you make 10 transactions a day where 3-4 of them are such that you can make them in a single shot then actually that would help. It is like people need to understand how to send multiple payments in a single transaction.

Transactions are still fast, but to make them fast you do have a pay pretty high fees.
Limiting the number of transactions that people could make isn't really a solution I think. That's one of the key aspects of Bitcoins.

The fact that there are entities spamming the network shouldn't be used to limit the rights of other people, we just need a seperate solution for that.

Yes, it's a crucial problem when bitcoin generated by miners decreases overtime which the price of bitcoin will increase so that with the fees. Imagine if you need to pay fee BTC0.0009 equal to $1 to send BTC0.05, but in the future BTC0.0009 may equal to $10, I don't know exactly number, how much we have to pay, but my last transaction takes $1.4 and more than 12 hours to get confirmed, what a loss for bitcoin I thought.

The fact that fee will eventually grow as the reward for mining a block gets lower has always been part of the plan on the development of bitcoin, the issue here is there is not a solution backed by everyone to make bitcoin scale.

Dude you and him are saying the same thing, that higher tx fees means more mining then how you don't agree with him ? Completely wrong assumption actually of you both because there are services like viabtc where they take your transactions and mine them in their block.

Actually I think high tx fees are limiting the number of transactions which indeed is good, tx should be more healthy in amount than in numbers.

And how can you tell a more healthy transaction from a less healthy one?

You should also take into account that it is still possible to flood the network with spammy transactions of just 1 satoshi each irrespective of whether they have fees or not, or whether miners are going to confirm them or not. In this manner, your distinction between healthy and unhealthy transactions is technically irrelevant. Other than that, the transaction processing network should be organized in such a way that it could digest any number of transactions. In other words, it should be made impervious transaction wise. In practice, that would mean that a spammer wouldn't be able to send more transactions (e.g. due to the limits of his Internet connection) that the network could process

Yes, fees is seemingly more because the price of bitcoins is very high too actually.
If you spend 0.0004 btc fees on a transaction and the rate is $1200 then actually you spend $0.5 on a say around $100 transaction which is still less as compared to paypal who charge like $2 - $3 for the same and yet the reversible worry all the time. But I agree with all that the fees should be reduced somehow please.

I don't think the fees will kill bitcoin even in the real world specifically banking sector where mirage of fees is being charged even sometimes enormous, people still use the banks and most times the fees are low compared to the importance of is to be achieved. Aside that, the bank will provide alternative means of reducing the fees and that's exactly what will happen to bitcoin later where other means of reducing the fees will be implemented for everyone use.

We all can agree on the fact that the bitcoin attracted most of us because it was a simple easy fast way of sending money, but with it becoming more popular and the price rising with every day it is starting to take a long time to send it, we used to be able to send bitcoin without fees and we will receive it immediately, but right now with more transactions to deal with and bitcoin getting harder to mine there will be now surprise that we will see the transaction fees also increasing. Miners demand for it.

There is a discussion about using altcoins for small transactions (and bitcoins for just investments) to reduce the network traffic. I am not sure about higher mining fees will not come down or not and persisting at higher level will kill bitcoins, only time may answer.

Before the 21M bitcoins being totally mined I'm sure till then technology advances enough to fork bitcoin using new methods/technologies.
So ETF was only rejected because of the state of the network 100 years from now?

We dont need to worry anymore about higher fees. If you have heard that bitcoin unlimited has lost its battle against the core developers then bitcoin will take a twist as segwit will be used in mining and the blocks will be increased and transactions will be processed much faster. Sooner or later lower mining fees will be implemented and all of us will be happy.

this now problem not only mining fee
but this now big problem about bitcoin unlimited and follower, bitcoin price is down because about bitcoin unlimited issue
The first problem to be solved about bitcoin unlimited, and then about fee and fast time transaction

Only the people accept segwit will this problem be solved. I can not believe that those lunatics keep believing in Bitcoin unlimited blindly. It is a tool for the China to control the whole Bitcoin system. It will eventually kill Bitcoin if it is activated in the future.

I get the feeling wallets are "overdoing" fees when it's totally unnecessary.

1. There are currently 1480 Unconfirmed Transactions (https://blockchain.info/unconfirmed-transactions).
2. bitcoinfees.21.co (https://bitcoinfees.21.co/) claims the "fastest and cheapest" transaction fee is 220 satoshi/byte, resulting in 49,720 satoshis for a 226 bytes transaction. (is this site owned by miners?)
3. btc.com (https://btc.com/stats/unconfirmed-tx) says the current best transaction fee is 20 satoshis/byte, less than 10% of the recommendation from bullet point 2:
https://s29.postimg.org/muiehztnr/fees.png
The above screenshot shows that most transactions with less than 10 satoshi per byte confirm quickly.

Now, what fees were used in the last 4 blocks?
457952 (https://blockchain.info/block/000000000000000002288e34cdd7368ec24f9450af2f7c0e49e4c9ad348f161f): 55987037 satoshis for 998.18 KB resulting in 54.8 sat/byte
457951 (https://blockchain.info/block/000000000000000000dcea79812618764b89bf2b389452604409c547333695a0): 141344188 satoshis for 998.064 KB resulting in 138.3 sat/byte
457950 (https://blockchain.info/block/000000000000000000d362944de836e66ab0d53c01c6a51ca637259d6de670ef): 206531288 satoshis for 998.136 KB resulting in 202.1 sat/byte
457949 (https://blockchain.info/block/000000000000000000cf9346cd685224e64526428896fc167aa0576144cfe734): 171280224 satoshis for 996.719 KB resulting in 167.8 sat/byte

I can only conclude wallet software is now massively over-estimating the required fee for a fast transaction, and we're all paying much more fees than needed when there aren't many unconfirmed transactions waiting.
And even worse, when there are a many transactions waiting, these same fees still mean we wait long.

I'm also expecting something to that tune

I read an article yesterday which claimed that supermajority of Bitcoin full nodes are SegWit ready already. So whatever fork mining pools might choose to use in the end, their decision will be irrelevant if these nodes (read ordinary Bitcoin users like you and me) won't support it. If they start mining their alt-Bitcoin but folks won't take it (read vote against it with their money), these mining pools will end up shooting themselves in the foot, and they will be simply losing real money, time and effort mining useless and worthless coin. In short, more power to the them

i also do not think that the transaction fee is going to kill bitcoin, but i think it will effect bitcoin too much. i think it is too much important that that fee should be minim and should not be increasing so frequently if you want to see bitcoin as more reliable and trusted.

I think Bitcoin is still cheap today, but faster seems to be fading due to lots of unconfirmed transaction or even delayed for several days.  The Bitcoin developer should act fast to have a consensus on how to solve this problem.  The situation is not funny anymore.   And limiting transaction does not solve the problem, besides this action will be annoying to people who loves to move their Bitcoin around, either by playing gambling games, shopping online or investing in trades and other business ventures.  Do not limit Bitcoins movement, it is healthy for the network.

If Segwit will be available and then LN will be used as same as alt-coins you propose.
If BTC will scary people from using BTC to expensive people will switch to alts ( such like LN )
Then people will have people if convert such alt again into BTC, because at time when needed BTC is just not useful anymore.
I would go into crore segwit proposal then LN.
LN will act like alts today,Many people today chose ETH/Doge/Dash because fees are ridiculous and confirmation times.
If user have shit product like BTC now and swith to alt like ETH he won't come back guys.
Such guy can go back when major ETH network issue accure and BTC will have stuff like LN.

It will kill Bitcoin in the sense that it will kill people's interest especially the newbies and the yet to know people, but we know together we form the decentralized technology behind Bitcoin and so if we loose the numbers we loose Bitcoin. Secondly comparing Bitcoin to fiat doesn't add up here because with the banks and the fiat you know people have no choice than to use it in their daily activities but with Bitcoin they can choose to abandon it if the fees are high so I think we should know where to draw the line.

I think that main line you see already that cap BTC have. Without any changes i don't see major BTC rise against inflation.
BTC today stay at limit that alone without community Segwit/LN or BU it won't pass.
Once you stop evolving you will slide down because ctypo won't wait for BTC.
This is like EU all see its dying bu noone can pass changes and only fall can bring revolution.
Same time countries in Asia don't wait for EU and evolve and have +5 GDP.

Alts will improve because of high competition in market share, BTC will fall slowly off even from mainstream radars.
I want BU miners make HF and move on their own chain, let other create segwit/LN and we will see what market will chose.
Enchanted BTC core or forked alt BU if this is only solution let it be, best chain will win.

The market price of a coin reveals everything you may need to know

Indeed, no one says there is nothing to know just beyond that but in respect to falling off slowly, the price will be the first hallmark if it ever comes to that. Regarding the BU folks (miners and developers alike), they seem to be the ones who are actually muddying the waters here. And the sooner they leave with their Bitcoin altcoin the better. But mark my words, they won't leave, they will continue to stay with Bitcoin. Otherwise, everyone and his dog will quickly find out that there is no substance behind them. All major exchanges have made it pretty clear recently

Well I'm not disputing that fact the mining fees were a part of the original plan but when there is discrimination in the determination of the fees then I have a problem because we need to be treated equally. Why should my transaction delay because I couldn't pay more fees? This is my bane and if we don't get it solved it can kill Bitcoin eventually.

There is no need to be treated equally

To force equal treatment in the way you want it would kill Bitcoin even faster. Socialism is not sustainable in a closed system. You basically want that someone else should pay the fee for you if you want to be treated equally and at the same time pay less. In fact, you don't need to be treated equally at all since if there were a true free market in the mining department, all transactions would be included even if higher paying ones (i.e. with more fees) would still be prioritized. The reason is pretty simple, in a free market miners would be interested to include all transactions with however small fees just because that would be a rational choice to increase profits. Right now they can increase profits by raising the fees themselves by excluding low-fee transactions. This is possible because there is a mining oligopoly in Bitcoin and users have no other choice but to pay higher fees

You can't include all transaction when there isn't space though. The limited block size means wait time for the lowest price/byte transactions. Increasing transactions to increase profits isn't possible when the blocks are maxed out on size. And you can look at the blockchain itself to see that blocks are just about maxed out, so there just isn't capacity to increase profits by accepting more transactions.

No i dont think it will totally kill bitcoins .with the advancement of the price tx fees will increase and i think it is the minimum when comparison to the taxes u pay through the governement .

Eventually, if we are about to compare the tax between the fiat money transactions and bitcoin transactions, bitcoin transaction's fee is still cheaper than fiat money transactions since it only pays miners, not the governments. However, if the governments charge or require every bitcoin's transaction, it would eventually keeps its users to prefer other means of transactions. This is quite possible, yet there's no assurance if it would eventually happen.

That is correct. The fees in bitcoin is still cheaper than the fiat or any other kind of payment method. Even though it is continue rising, i think the fee is still fair for the users that are usually doing transactions because even though they send a lot of money, the fee is not that high and you can still have much left in your wallet. Also, the transactions are still average in time frame and i can received bitcoin within an hour which is still great with a cheaper fee in it.

How long and how often have you actually been using "fiat or any other kind of payment method"?

In most cases, you don't have to pay anything as a transaction fee if you buy things both online and offline using a payment card like Visa or MasterCard. In fact, the bank which issued the card can even give you a certain percentage of cashback on a specific category of purchases (or just on all purchases) if you use their card. Needless to say that all these transactions are virtually instant (typically, it takes only a few seconds to confirm the transaction). Some banks even offer free of charge wire transfers up to a certain limit of amount transferred. You could hypothetically transact in bitcoins with no fees at all, provided you first completely exclude confirmation times (up to a few days) from consideration altogether

Its the biggest issue which the bitcoin environment is facing today.I had to pay my friend some amount and so i sent btc with a fee of 0.0009 manually set hoping that it would be confirmed quickly.But what happened is i had to wait for 24 hours to receive the payment.In this digital world,every thing happens fast and digital gold taking more time seems very much contrast.

You must understand that the price of miners fee is dictated by the size of the transaction in bytes and not by the amount you send, you could have send a million dollars and the fee will still be 50 cents which is very cheap what this means is that bitcoin is no longer a good way to send microtransactions.