[Apr 2024] Fees are high, wait for opportunity to Consolidate your small inputs

[LoyceV]

Mods: I realize this isn't really a Technical Support question, but it's related to dozens of support request threads that have been made in the past, and it can potentially reduce support requests in the future. That's why I post it here.

Background
Whenever the Bitcoin network gets more congested, fees get higher and higher. Most wallets now use "dynamic fees", which means they start competing with each other for fast confirmations. This results is fees spiraling upwards. Not so long ago, more than 600 Satoshis/byte was needed to have any chance at a fast confirmation.
The result: this board filled up with topics like: "my transaction got stuck for 2 weeks, help me". At the moment, these topics don't exist, which is the reason I open this "opposite" topic.

Example
18 days ago, someone made this 4909 bytes transaction with 33 inputs and 510 Satoshis/byte fee. After paying fees, his 0.033BTC turned into only 0.0079539BTC. If he would make the same transaction now with 20 Satoshis/byte fee, he would have saved 0.024BTC. Instead of just 0.0079539BTC, he would have ended up with 4 times more!

Opportunity
Since about a week, fees are quite low again. For many months now, even transactions with 1 Satoshi/byte are likely to get confirmed within an hour.
If you've been collecting faucets in the past, you most likely have many inputs around 0.000xBTC. A few weeks ago, anything under 0.001BTC wasn't even enough to pay for the fee. If you set a very low fee now, you can consolidate inputs as low as just 2000 Satoshis (0.00002BTC).

It's good for everyone
If you make a big transaction with high fees when the network is congested, you take up a lot of scarce block space. This makes the congestion even worse.
By making a big transaction when the network isn't congested, you're prepared to be able to make a much smaller transaction once the network is congested again, without adding much to the congestion.

Consolidate small inputs
If you have many small inputs, now is the perfect time to consolidate them into one new input! If you're not in a hurry to get a confirmation, you can set a very low fee and just wait. Once it's confirmed, your funds can be send in a much smaller transaction, which means you'll safe a lot on fees if you want to make a transaction when fees are high again. If you have enough small inputs, you can safe up to 95% or more on fees!

How
Now the tricky part: it depends on your wallet! The easy way would be to just send your entire balance to a new address in your own wallet. Make sure to manually set the fee!
I prefer to "Enable coin control" in Bitcoin Core, you can do this in Electrum too. Select the inputs you want to use, and leave out very small dust inputs (say 0.00001BTC, it would still cost more in fees than it's worth). Then simply send all selected inputs to a new address of your own.
If you have many different inputs, I suggest to consolidate them in multiple steps. Don't create a 100,000 bytes transaction with 500 inputs, but instead create many transactions with 20-ish inputs.

If your wallet doesn't allow you to set your own fee, and/or to use coin control, you can export your private keys and import them into a wallet that does support it. This, however, is something to discuss in another topic.

Privacy
Consolidating your inputs links them together on the blockchain. This wouldn't be any different when you use the same funds in any other transaction, but you should consider this before doing it.

SegWit
User Wind_FURY found a comprehensive overview of Techniques to reduce transaction fees, including the use of SegWit addresses.

Fee estimators

• https://jochen-hoenicke.de/queue/#0,1w (thanks pooya87)
• https://coinb.in/#fees This site lets you manually select inputs and outputs to see the transaction size (in bytes)
• https://btc.com/stats/unconfirmed-tx
• https://estimatefee.com (recommends a fee estimate after you set a number of blocks to confirm within (Update April 6, 2019: the recommendation from this site is 3 times higher than what my Bitcoin Core recommends) -- thanks lite)

No spam
All my threads are now self-moderated to stop signature spam. I will remove all irrelevant posts. If you quote the entire OP, your entry will be deleted.
Once in a while I'll summarize posts and clean up this thread.

Disclaimer
Use this information at your own risk. At all times, think before each action, especially when you're dealing with private keys. When in doubt, don't do it!
I'm human, I make mistakes. If something is incorrect, please let me know.

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[cellard]

It's always a double edged sword. As you mentioned, joining all of your inputs in a single address is a big mistake privacy wise. Anyone accepting Bitcoin payments across different websites for example, doesn't want to join all of their payments in a single address or else it could be known that you control all these websites. You want to have each website as a separate entity.

I think until we have schnorr sigs, the problem of big sized transactions due many inputs will remain a latent one. I believe schnorr sigs will lower the size of these joined transactions a lot. Maybe you will save more money by doing these joined transactions once it's available.

[NeuroticFish]

Although I also though about consolidating the inputs these days, I was not smart enough to make a proper thread and increase awareness. I somehow wanted to wait more, until the fees drop even more. You made this thread, well done!

Just imho you've missed something and I would like to ask you make the first post a bit bigger, including this info (in the way you chose to present it) :
When the fees are big, people pay too much for too reasons: inputs not consolidated and wallet not supporting yet SegWit. The users should consolidate their inputs, as possible, directly into SegWit wallets.
Maybe the "bc1" wallets are not recognized by exchanges and people would prefer to stay compatible, they have then option for the "3.." SegWit wallets.


Edit: I use 3.. SegWit address lately, but I don't do many transactions. The 2-3 transactions I've done went out nicely. Thanks for your answer and covering this point too, the linked article is indeed well made, hopefully enough people will spend the time to read it. I will also read it to consolidate the chunks of knowledge I have from here and there.

[LoyceV]

@cellard
I've read the term Schnorr signatures before, but never fully understood it. It seems to be under development since a few years. I'm not waiting for it, fees can also just keep rising.

@NeuroticFish
I've added a small note on SegWit. I didn't cover it yet for two reasons:
1. The effect on the fee is much smaller than what you can safe by consolidating at the right moment.
2. I still haven't setup a SegWit wallet by myself (it on my TODO list though), so I can't speak from experience.
Wind_FURY's link explains it much better than I ever can.

[nullius]

@cellard
I've read the term Schnorr signatures before, but never fully understood it. It seems to be under development since a few years. I'm not waiting for it, fees can also just keep rising.

These two links should help give a conceptual grasp of what Schnorr signatures do and why you’d want them.  I myself want them so badly I can taste them, so to speak.  Though no, you are correct, it would be as yet quite impractical to wait for them.

https://medium.com/@SDWouters/why-schnorr-signatures-will-help-solve-2-of-bitcoins-biggest-problems-today-9b7718e7861c

https://medium.com/@nopara73/privacy-and-schnorr-signatures-e2175d27f022

2. I still haven't setup a SegWit wallet by myself (it on my TODO list though), so I can't speak from experience.

Oh, I strongly encourage you to bump that up the list!  If you use nested “3” addresses, that’s a drop-in replacement for what you use now.  If you use Electrum, I could walk you step by step through setup of either type of wallet; I took a bunch of screenshots and planned a guide, but never quite got around to assembling it.  That’s probably the easiest option right now.

Core v0.16 is coming soon, with Segwit support in the GUI and change addresses.

[LoyceV]

These two links should help give a conceptual grasp of what Schnorr signatures do and why you’d want them.  I myself want them so badly I can taste them, so to speak.

Thanks for the links. It seems to fit this thread, and I'll read them later.

If you use Electrum, I could walk you step by step through setup of either type of wallet; I took a bunch of screenshots and planned a guide, but never quite got around to assembling it.  That’s probably the easiest option right now.

I think I know the basics (import seed words for an S-address, or go native Segwit with Bech32). I was planning to make a guide too if I install it, but I appreciate it if you make one.

Core v0.16 is coming soon, with Segwit support in the GUI and change addresses.

As a Core user, I am waiting for this upgrade. I don't really want to switch to Electrum as a main wallet.


Note: fees are a bit higher at the moment. You now need 180 Satoshi/byte for a fast confirmation, but this thread is not about getting it confirmed fast.

[nullius]

Thanks for the links. It seems to fit this thread, and I'll read them later.

Happy to help.  If you have any questions, please don’t hesitate to ask.

If you use Electrum, I could walk you step by step through setup of either type of wallet; I took a bunch of screenshots and planned a guide, but never quite got around to assembling it.  That’s probably the easiest option right now.

I think I know the basics (import seed words for an S-address, or go native Segwit with Bech32). I was planning to make a guide too if I install it, but I appreciate it if you make one.

Import of seed words for backward-compatible “3” addresses has two small extra steps in the middle for which non-Bitcoin-expert users should really have screenshots (selecting a BIP 39 mnemonic, and changing the derivation path to m/49'/0'/0').  That’s why I thought to make a guide with screenshots; I wouldn’t otherwise, given how userfriendly that program (mostly) is.  The process is neither complicated nor difficult; but I think visual instruction is warranted in a money-related matter, where users might be understandably nervous about potentially entering the wrong thing in the wrong box.

The major hold-up is a bit embarrassing, and totally off-topic here.  (Lack of free, Tor-friendly image hosting with a UI convenient to me for keeping a few dozen screenshots organized.)  If/when I get that together, for which forum do you suggest it would be most appropriate?  The Electrum subforum, Help, here, or somewhere else?  It’s a special case—not so much an Electrum thing as a “Segwit the easy way/reduce your fees” thing.

Core v0.16 is coming soon, with Segwit support in the GUI and change addresses.

As a Core user, I am waiting for this upgrade. I don't really want to switch to Electrum as a main wallet.

Good call.  The desire to use one’s own full node (without using JSON-RPC as the UI!) is probably the only good reason anybody could have for not using Segwit at this point.  Unfortunately, it is a good reason—until v0.16!

[onnz423]

Excellent post with good information for both old and new users. I'd recommend consolidating your bitcoin into a segwit enabled wallet for further savings on fees, also future proofing yourself to enable use of the lightning network when it is implemented at your exchange/favourite store.

[Ayanamirs]

I took advantage of low fees to send all my bitcoins to a new address bc1. I had 31 inputs.

[LoyceV]

The major hold-up is a bit embarrassing, and totally off-topic here.  (Lack of free, Tor-friendly image hosting with a UI convenient to me for keeping a few dozen screenshots organized.)  If/when I get that together, for which forum do you suggest it would be most appropriate?  The Electrum subforum, Help, here, or somewhere else?  It’s a special case—not so much an Electrum thing as a “Segwit the easy way/reduce your fees” thing.

I think it would get most exposure here on Bitcoin Technical Support. The Electrum board would be more fitting, but it's not listed directly on the main page. I barely go there.

Today, I consolidated 4 inputs. The transaction with 8.356 sat/B took 12 minutes to confirm.
The first block after I made the transaction had 1.3 BTC in fees. The second block was found just 1 minute later, and had only 0.07 BTC in fees. This is the sweet spot of low fee opportunity this topic is aiming for! It included a transaction with 1.478 sat/B fee (600 Satoshis).
My transaction was confirmed in the second block. In retrospect, I could have paid 80% less fee (I am in no hurry to use the funds).

Earlier today I received a transaction with only 5.018 sat/B. This one confirmed in 3 minutes.

[LoyceV]

Transactions with around 5 Satoshis/byte are getting confirmed again, and the number of unconfirmed transactions is still quite low.

[nullius]

Thank you for making this thread, LoyceV.  You’ve saved me real money.

Since I first saw this, I’ve been doing transactions with fees far lower than I would have otherwise even considered attempting, much less dared to try.  This is not to consolidate anything (I mostly avoid coin-merge), but just for ordinary transactions.

Of course, it should go without saying, I’ve been exclusively using Segwit addresses for months (both nested and native).  That also helps significantly.

[jackg]

Bump! Fees are still low.

I stumbled upon https://coinb.in/#fees as a brilliant fee estimator! I forgot who posted it (sorry), so can't give credit.
It currently recommends 3 sat/byte for a fast confirmation. In the spirit of this topic, when you're not in a hurry, you can go lower.

Where's the 3 Sat per byte one? I see 112 (sorry, wanted to see where it was to get an estimate on transferring one piece of dust just to get it out of one of my wallets).

That's a really great link as well. The dynamic sliders are quite good and give a great estimate for the fee, credits to the developer for the great site!

[LoyceV]

Where's the 3 Sat per byte one? I see 112 (sorry, wanted to see where it was to get an estimate on transferring one piece of dust just to get it out of one of my wallets).

It currently even recommends 1 sat/byte. Fees vary depending on how long it takes to find a block, I'd say consolidate your "one piece of dust" with another input now. Pay about 800 sat fee, and wait.

[lite]

Where's the 3 Sat per byte one? I see 112 (sorry, wanted to see where it was to get an estimate on transferring one piece of dust just to get it out of one of my wallets).

It currently even recommends 1 sat/byte. Fees vary depending on how long it takes to find a block, I'd say consolidate your "one piece of dust" with another input now. Pay about 800 sat fee, and wait.

It keeps fluctuating lol, currently it recommends 4 sat/byte. i've moved my bitcoins to segwit address as soon as it was implemented on trezor.  thanks for the thread anyways, should be helpful to newbies.

I wanted to share this good tool(maybe add it in op?) (https://estimatefee.com), helps in estimating within how many blocks the tx will get confirmed, also calculates fees.

[Unibright]

Fees going down is essential for Bitcoin being used normally again like it once was... past months have just been too pricey to send smaller input

[jackg]

Where's the 3 Sat per byte one? I see 112 (sorry, wanted to see where it was to get an estimate on transferring one piece of dust just to get it out of one of my wallets).

It currently even recommends 1 sat/byte. Fees vary depending on how long it takes to find a block, I'd say consolidate your "one piece of dust" with another input now. Pay about 800 sat fee, and wait.

Next time I need to move all my keys I might just do it then. It's 0.0001BTC but it's just stuck in a wallet on it's own (fairly dissappointing).

Where's the 3 Sat per byte one? I see 112 (sorry, wanted to see where it was to get an estimate on transferring one piece of dust just to get it out of one of my wallets).

It currently even recommends 1 sat/byte. Fees vary depending on how long it takes to find a block, I'd say consolidate your "one piece of dust" with another input now. Pay about 800 sat fee, and wait.

It keeps fluctuating lol, currently it recommends 4 sat/byte. i've moved my bitcoins to segwit address as soon as it was implemented on trezor.   thanks for the thread anyways, should be helpful to newbies.

I wanted to share this good tool(maybe add it in op?) (https://estimatefee.com), helps in estimating within how many blocks the tx will get confirmed, also calculates fees.

That's a great tool. Next time I need to consolidate my other transactions into one, I'm going to try the 1004 blocks recommendation and see how it does (providing it doesn't get rejected by the network as I think there was a protocolled minimum for most miner nodes now).

[LoyceV]

Fees are still low.

I stumbled upon https://coinb.in/#fees as a brilliant fee estimator! I forgot who posted it (sorry), so can't give credit.
It currently recommends 2 sat/byte for a fast confirmation. In the spirit of this topic, when you're not in a hurry, you can go lower.

[LoyceV]

Usually, Sundays are the best days to make transactions with low fee. I just made this transaction: 3 uncompressed legacy inputs, 1 output, 582 bytes, and 0.00001BTC (0.01mBTC / 1000 Satoshis / $0.11) fee (1.718 sat/B). It confirmed in 4 minutes.

The same block also included many transactions with 1 sat/B fee, and many good examples of what this thread is all about: this 8907 bytes transaction with 1.106 sat/B fee confirmed after 4 days. One dollar in fees to consolidate 0.19BTC!

[pooya87]

i found out that the best option to choose fees is using this website: https://jochen-hoenicke.de/queue/
so far bitcoinfees.earn.com is inaccurate and leads to higher fees. coinb.in is better but i haven't checked it in long term to see how it performs under different circumstances.

https://jochen-hoenicke.de/queue/ is simply the representation of transactions in the memory pool and the amount of fees they are paying.
set the interval to 24 hours and look at last chart (Mempool size in MB). mouse over the last point(s) and see how much size is on how much fee. for example in below picture 2.4+ MB is paying 2+ fees. that is 1130 transactions. bitcoin blocks are currently around 1-1.2 MB so anything above 2 Satoshi/Byte has a high chance of giving you high priority.
i use size (last chart) instead of count (first chart) because sometimes mempool is filled with small transactions and sometimes large ones. so you don't know if 100 tx paying 5 s/b is going to fill the block or only take up 10% of it for example.



hopefully we see Electrum 3.1 sooner and see other wallets and websites implement this method instead.