By the way, bitcoin fee structure is a one size fit all solution: the fee is based on transaction, not transaction value. This will unavoidably benefit large transactions while hinder small transactions. Suppose that I'm transacting 100 coins, 0.01 btc fee will be extremely small for me, but for those transacting 0.1 bitcoin, it is prohibitively highBased on a research paper from FED researchers, the majority of the bitcoin transactions are larger than 0.2 bitcoin, or $80, so the fee should be targeting this threshold, around 0.002 bitcoin level to not hurt majority of users. The problem is, without a block size limit, the fee per block will always be a small fraction of the block reward (I have detailed analysis
here), thus there is almost no way to reach such high level of fee. So if blocks are not full, the only hope to keep miner's incentive is a continuously rising exchange rate
I wonder if circumstances like this will give rise to off-chain privately run blockchains, where basically a main few aggregators of transactions run private ledgers that are cheaper to operate, and then sync to the BTC blockchain every so often, like once every couple days or so, to cut down on the amount it costs in transaction fees per transaction. I imagine they would charge a fraction of what it costs to conduct an on-chain transaction, then keep the difference between what they charge and what it actually costs to sync to the blockchain. Although we're a far way off from transaction fees making up the bulk of block rewards, it's interesting to think about how the system will have to adapt in order to keep transaction costs from becoming prohibitively expensive for small transactions.
