Correlation between increase in transaction fees and Bitcoin price.

[2double0]

Mind well everyone, I have smelled this pump incoming.
You know how? I watch the network congestion every now and then. And guess what, I had been seeing unnecessary high fee payers once again which gave me a signal of an assured rise in the price of Bitcoins. Either way, it goes like this or opposite as sometimes, when price of BTC rises, fee starts to rise and chase its previous higher highs. Is $5000 showing a possibility of BTC transaction fees to be rising to newer highs too?

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[boyptc]

Mate, I have also noticed that I guessed it's already part of the pump.

Whenever the market goes up, expect fees goes up too. Last Dec. 2017, there's a network congestion that made fees too high.

[alisafidel58]

Is $5000 showing a possibility of BTC transaction fees to be rising to newer highs too?

We've seen this event in the past were fees reach an ATH too along with bitcoins ATH. I think this the fault of people whos at panic mode when sending bitcoin in an exchange.

I think when the pump ends and there is a correction the fees will also be back to normal.

[n0ne]

This is quite common and this has taken place several times in the past as the users above stated. This isn't an issue anymore, at times this gets correlated with the block size issue. Now the translation accelerators play a big role in pushing transactions free as well as a paid service. This network congestion automatically gets resolved in a course of time.

[avikz]

Mind well everyone, I have smelled this pump incoming.
You know how? I watch the network congestion every now and then. And guess what, I had been seeing unnecessary high fee payers once again which gave me a signal of an assured rise in the price of Bitcoins. Either way, it goes like this or opposite as sometimes, when price of BTC rises, fee starts to rise and chase its previous higher highs. Is $5000 showing a possibility of BTC transaction fees to be rising to newer highs too?

Yes! There is a reation between the market price and transaction fee and you guessed it right! Usually when the price goes higher, the network experiences a lot of transactions which leads to congestion! And whenever there is congestion, the network fees increases which also increases the number of unconfirmed transactions.

During normal times, the usual number of unconfirmed transactions remain between 1200 - 8000. However , it is more than 62k now while writing this reply!

[tomahawk9]

Mind well everyone, I have smelled this pump incoming.
You know how? I watch the network congestion every now and then. And guess what, I had been seeing unnecessary high fee payers once again which gave me a signal of an assured rise in the price of Bitcoins.

You might onto something.

I've said it in another thread, fees have been on the rise since last week for no reason.
Take a look at how the mempool looks over a 2-week period: https://jochen-hoenicke.de/queue/#0,2w

Fees began to increase on March 26, unless something was going on behind the scenes and traders started making their move, I can't find something that can explain that sudden rise in fees.

If you check bitcoinfees.earn(dot)com, the optimal fee at the time of this post is 98 sats, so there's a lot of people overpaying for fees, pretty crazy considering that you could pay from 20-40 sats and get your tx confirmed in a few hours but I guess some people don't have the patience to wait.

[vixcious]

Mind well everyone, I have smelled this pump incoming.
You know how? I watch the network congestion every now and then. And guess what, I had been seeing unnecessary high fee payers once again which gave me a signal of an assured rise in the price of Bitcoins. Either way, it goes like this or opposite as sometimes, when price of BTC rises, fee starts to rise and chase its previous higher highs. Is $5000 showing a possibility of BTC transaction fees to be rising to newer highs too?

it is surely that. but the transaction fee only increases at the time the price of the BTC has increased. it doesn't increase too much after that. Because the trading volume at the market is very high, so the fee must be higher.
then they will adjust the fee to a reasonable level. do not worry buddy

[STT]

Just down to basic activity I think, however since 2017 we now have segwit and LN to accommodate some of the traffic.   I would seriously hope we never see the fees rise to such silly levels as 2017 saw.   This was really destructive even if it was a nice pay day for the miners, its not feasible to say Bitcoin is useful when 'stuck' in that way

But I'd agree it is some indicator to take note and volume does help confirm a rise which might otherwise not hold.   I want to see more websites introduce consumers to cheaper alternate uses of BTC, hopefully this happens so we get more people with a positive view and experience with Bitcoin transactions, speed, processing, etc





https://medium.com/@overtorment/bitcoin-replace-by-fee-guide-e10032f9a93f

[dothebeats]

I fear that this might be the case if FOMO kicks in harder and a lot of people would be wanting to trade their bitcoins to get in on the action. It has happened in the 2017 bull run, though during those times the LN wasn't deployed or not even fully operational, and we might see some changes this time around considering that the LN is already up to take a chunk of the network's transactions. Volumes rising, together with mempool rising with a somewhat unknown cause can be a great indicator of what's to come in the market, though it can always go either way, always.

[Beerwizzard]

If you trying to figure out what caused the pump then it is important to consider the cause and effect. IMHO it seems like price growth caused fee increase: holders found a chance to sell their coins, exchange it into alts or just buy something irl while the price was growing due to growth on exchanges, where most operations are performed outside the bitcoin blockchain.

[fiulpro]

The transaction fee and Bitcoin price doesn't really matter to be honest , every single exchange is going to take what they take from the beginning .
For example is there is a exchange A that is taking 0.0005 BTC per transaction it's going to take that no matter what the price of Bitcoins surge, this is really weird to be honest if the Bitcoin price surged to millions ? What are we gonna do ? 🤣 Stop using exchanges ..
?
This is something that I find very stupid in most exchanges but there are some where they increase and decrease the amount of the Bitcoins they take and I think those ones are better off to be considered for the use .
No matter what the transaction fee is still gonna be very high .
But if we use segwit , that's really good at this to be honest the fee and all decrease drastically and you have the option to pay according to your choice , you can choose the slower one and even the high speed one.

Hope this answers your question.

[jakelyson]

I fear that this might be the case if FOMO kicks in harder and a lot of people would be wanting to trade their bitcoins to get in on the action. It has happened in the 2017 bull run, though during those times the LN wasn't deployed or not even fully operational, and we might see some changes this time around considering that the LN is already up to take a chunk of the network's transactions. Volumes rising, together with mempool rising with a somewhat unknown cause can be a great indicator of what's to come in the market, though it can always go either way, always.

This will be the true test of LN and Segwit. Once we start a bull run, transactions will pour in by the dozens. I do not want to experience what happened to the network before where transactions get trapped for hours before getting confirmed. You need to pay a very high fee if you want to get confirmed fast. I hope these technologies will help to process transactions fast enough that we do not need to raise tx fees.

[akamit]

Today I paid BTC0.00029744 ($1.53) for a $92 bill as a regular transaction fee and even waited about an hour for the transaction to get confirmed.

Fees may have increased because of heavy transactions taking place due to the BTC pump.

How much can we expect in the next run?

[Zadicar]

Today I paid BTC0.00029744 ($1.53) for a $92 bill as a regular transaction fee and even waited about an hour for the transaction to get confirmed.

Fees may have increased because of heavy transactions taking place due to the BTC pump.

How much can we expect in the next run?

It would be more, so its not really surprising that sudden pumps on bitcoins price correlates with huge volume of transactions and with that,fees are going high too.We have seen
in the past on how fees react when BTC price reaching its ATH? Fees are insanely high and this is one of the reason why Bitcoin do still have a problem when it comes to these kind of situations.
We have LN and Segwit though.

[1Referee]

Speculators happily outbid basic users to get that first next block confirmation. It might get worse if the price pumps further because of how speculators will then try to outbid each other, and this could cause the fees to be pushed to levels well beyond a regular situation with the same number of unconfirmed transactions.

Speculators also paid up for the fees during the 2017 bull run. Their potential profits were so large that a $50-$100 fee was peanuts to them. It's party time for miners, but a bad situation for basic users trying to get their transaction confirmed.

In the end, current network congestion is a much needed test for Bitcoin and Segwit. As far as I can see, the fees are not that extreme. If the fees do end up going towards something that most people consider extreme, it will only boost Segwit adoption because exchanges will be forced to offer users a better user experience.

[tomahawk9]

How much can we expect in the next run?

If the uptrend continues for a few more months and we enter another bull market like the one in 2017, we could see fees go as high as two years ago (at least in Legacy transactions). If I'm not mistaken, fees around December 2017, the peak of the bull run, were around the $20-$30 range, and I think the highest average fee we reached back then was around $50 when we were in the 19k-20k area.

But maybe things will change this time around since we now have SegWit and the LN, we'll see how things develop in the next few months.

[exstasie]

In the end, current network congestion is a much needed test for Bitcoin and Segwit. As far as I can see, the fees are not that extreme. If the fees do end up going towards something that most people consider extreme, it will only boost Segwit adoption because exchanges will be forced to offer users a better user experience.

Or people might use it as a political tool like the 2016-2017 period. We might see companies like Blockchain and Bitpay and Bitmain and Bitcoin.com start pushing their political agenda again. I tried to use Bitpay to buy an Amazon gift card last night and they're already charging nearly $2 in miner/network fees at the moment. I don't see them switching to Segwit anytime soon. They seem perfectly content using it as a political selling point to bash Bitcoin and push Bitcoin Cash and other lower fee altcoins.

It's also interesting to see Garzik backing Veriblock, which incentivizes its validators to incessantly spam the Bitcoin blockchain with OP_Return transactions and is apparently now having quite an effect.

[STT]

So long as it clears the transactions in a day or so its ok to call it liquid still.   If we start to observe a backlog of transactions that is never cleared then its actually a negative situation regardless of the price movement and we should not expect it to end well from that point.    I will look later for a graph of the various layers to transactions waiting to process, usually gives a good grasp of whether people have got caught out by technology or possibly outdated wallets not using realistic fees.

One point I noticed was Bitcoin cash doubling in price, so an outperformance even past this rise presumably because of this effect.   We do have alternatives, its a test whether they are going to be fully utilise and will relieve pressure to avoid a repeat

[boyptc]

How much can we expect in the next run?

AFAIK I paid around 0.01BTC or more than that during last all time high.

We may expect higher than you paid if this pump pushes through.

[Xising]

Mind well everyone, I have smelled this pump incoming.
You know how? I watch the network congestion every now and then. And guess what, I had been seeing unnecessary high fee payers once again which gave me a signal of an assured rise in the price of Bitcoins. Either way, it goes like this or opposite as sometimes, when price of BTC rises, fee starts to rise and chase its previous higher highs. Is $5000 showing a possibility of BTC transaction fees to be rising to newer highs too?

I somehow agree, and I also think this is a basic in every market; as more transactions are piling in and happening, the better one asset goes because of the movement it gains. In the stock market, when a stock is usually bought and sold, which ultimately increases its traffic, it would be given a positive image by most investors, which in turn, would help drive up its value significantly, especially when more and more people are wanting to buy their stocks. I think, it's the same principle that's happening in the cryptocurrency market, the more transactions using Bitcoins are happening, the more its price point gains.