Mining fees will eventually kill bitcoin

[qwik2learn]

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

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[lionheart78]

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.

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.

[Dudeperfect]

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.

[Invester]

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.

[Alesis]

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

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.

[Rinder]

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.

[olubams]

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):

As the number of Bitcoins awarded for solving a block in the Blockchain decreases, the incentive for miners to continue to contribute processing power to the Bitcoin Network will transition from a set reward to transaction fees. The requirement from miners of higher transaction fees in exchange for recording transactions in the Blockchain may decrease demand for Bitcoins and prevent the expansion of the Bitcoin Network to retail merchants and commercial businesses, resulting in a reduction in the Blended Bitcoin Price.

If transaction fees paid for the recording of transactions in the Blockchain become too high, the marketplace may be reluctant to accept Bitcoins as a means of payment and existing users may be motivated to switch from Bitcoins to another Digital Math-Based Asset or back to fiat currency. Decreased use and demand for Bitcoins may adversely affect their value and result in a reduction in the Blended Bitcoin Price.

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?

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...

[freedomno1]

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):

As the number of Bitcoins awarded for solving a block in the Blockchain decreases, the incentive for miners to continue to contribute processing power to the Bitcoin Network will transition from a set reward to transaction fees. The requirement from miners of higher transaction fees in exchange for recording transactions in the Blockchain may decrease demand for Bitcoins and prevent the expansion of the Bitcoin Network to retail merchants and commercial businesses, resulting in a reduction in the Blended Bitcoin Price.

If transaction fees paid for the recording of transactions in the Blockchain become too high, the marketplace may be reluctant to accept Bitcoins as a means of payment and existing users may be motivated to switch from Bitcoins to another Digital Math-Based Asset or back to fiat currency. Decreased use and demand for Bitcoins may adversely affect their value and result in a reduction in the Blended Bitcoin Price.

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?

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.

[calkob]

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.

[Mometaskers]

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.

[carlerha]

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.

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.

[Dudeperfect]

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.

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?

[megynacuna]

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.

[deisik]

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):

As the number of Bitcoins awarded for solving a block in the Blockchain decreases, the incentive for miners to continue to contribute processing power to the Bitcoin Network will transition from a set reward to transaction fees. The requirement from miners of higher transaction fees in exchange for recording transactions in the Blockchain may decrease demand for Bitcoins and prevent the expansion of the Bitcoin Network to retail merchants and commercial businesses, resulting in a reduction in the Blended Bitcoin Price.

If transaction fees paid for the recording of transactions in the Blockchain become too high, the marketplace may be reluctant to accept Bitcoins as a means of payment and existing users may be motivated to switch from Bitcoins to another Digital Math-Based Asset or back to fiat currency. Decreased use and demand for Bitcoins may adversely affect their value and result in a reduction in the Blended Bitcoin Price.

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?

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

[markyminer]

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.

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?

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.

[DoublerHunter]

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.

[X-ray]

Mining fees or transactions fees are keep on rising up and its becoming more expensive than before

https://bitcoinfees.21.co/

The fastest and cheapest transaction fee is currently 220 satoshis/byte, shown in green at the top.
For the median transaction size of 226 bytes, this results in a fee of 49,720 satoshis.

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.

[suredoood]

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.

[deisik]

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.

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

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)

[Goldman Enterprises]

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.