Miner's fees

[BADecker]

Look at how Bitcoin is shooting up... just like it did at the end of 2017. Will we see the joint-rise in miners fees like we did back in 2017? It's essentially the miner's fee rise that made Bitcoin drop. I mean, when the fee gets so high that you are paying as much for the fee as you are spending in your transaction, what good is Bitcoin?

There isn't as much decentralization in bitcoin as we think. All the big miners know who they all are. They probably contact each other now and again. They can easily get on the phone with each other, and time a rise in miner's fees for, say, the middle of December.

So, will we see a sudden miner fee rise this time? One that will bring Bitcoin crashing down like at the beginning of 2018?

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[ranochigo]

Miner's fees do not dictate the market's movement I think you've got it wrong. Why would people care about how high the miner's fees are when most of them don't even spend it and see it as a store of value? Not a lot of people cares about miner's fees especially when Lightning, Segwit already exists.

And also why would the miners collude and increase the mining fees AND make the price crash? Wouldn't they be losing out? What if it doesn't recover? I'm really confused.

[BADecker]

^^^ Perhaps you are confused.

Back at the beginning of 2018, some people were paying miner fees in the amount of $50 or more.

Part of the Bitcoin idea was to use it for buying and selling. If my neighbor came over, and wanted to buy my old, used lawnmower from me for $50 in Bitcoin, but had to pay a $50 miner fee on top of it, why even think about using Bitcoin?

I have, even now, spent bitcoins with a miner fee too low, that it took forever to confirm the transactions, or that I had to go in and raise the transaction fee to get it to confirm.

Miners control the fee. If they get together and raise the fee, or they won't confirm the transactions without the proper high fee, nobody wants to use Bitcoin any longer. The price goes down.

And why not? Supply and demand. If the people who control it can make more money off it, why not?

[ranochigo]

Perhaps you are confused.

Yes, that's what I said.

Back at the beginning of 2018, some people were paying miner fees in the amount of $50 or more.

Part of the Bitcoin idea was to use it for buying and selling. If my neighbor came over, and wanted to buy my old, used lawnmower from me for $50 in Bitcoin, but had to pay a $50 miner fee on top of it, why even think about using Bitcoin?

Yep. Some did, if they needed to confirm the transaction within a short period of time. I'm not disputing that. I agree that it's not practical for Bitcoin to exist in that situation but we've come a long way and now there's far more optimization (Segwit, LN, Schnorr) made to Bitcoin than that period of time. I don't find the correlation between having a high TX fee and the crash of that period of time. IIRC, the crash was a result of several institutions making the decision to clamp down on Bitcoin and the lack of support from the various governments.

I have, even now, spent bitcoins with a miner fee too low, that it took forever to confirm the transactions, or that I had to go in and raise the transaction fee to get it to confirm.

Miners control the fee. If they get together and raise the fee, or they won't confirm the transactions without the proper high fee, nobody wants to use Bitcoin any longer. The price goes down.

And why not? Supply and demand. If the people who control it can make more money off it, why not?

No, no. My point is: What is going to happen if the miners crash Bitcoin? The miners can't sell their remaining Bitcoins, the Bitcoins that they mine are going to be worth less and they're going to be making less profit? I'm saying this because you're drawing a parallel between the miners gaming the fees and the market. What are the incentives for the miners by crashing the market? I'm not saying you're wrong but I just want some clarifications on my doubts.

[Twentyonepaylots]

Miner's fees do not dictate the market's movement I think you've got it wrong. Why would people care about how high the miner's fees are when most of them don't even spend it and see it as a store of value? Not a lot of people cares about miner's fees especially when Lightning, Segwit already exists.

Indeed, people these days does not care about this anymore, they already know how things work in crypto and such fees is determined by the traffic, if they see a high transaction fee they'll know that the volume is increasing, vice versa. I myself does not bother anymore with fees, but honestly I won't be paying too much from what I really expected, like 30% of how much I will send.

And also why would the miners collude and increase the mining fees AND make the price crash? Wouldn't they be losing out? What if it doesn't recover? I'm really confused.

This is why they just hold the accumulated fees, not to add the gas in the market when it gets wild creating an average fees.

[BrewMaster]

Look at how Bitcoin is shooting up... just like it did at the end of 2017.

you should take another look at the charts. by the end of 2017 price was going up $11000 in 20 days (150%). right now we barely see 10% rise.

Will we see the joint-rise in miners fees like we did back in 2017?

we've already seen some spikes but nothing like 2017 mainly because this rise is not like the rise in 2017.

It's essentially the miner's fee rise that made Bitcoin drop.

sorry but that is nonsense.
you need to check out history again.
the fees went up pretty much at the beginning of 2017 and by mid 2017 it was at the ATH of fee while price was still at $2k-$4k and remained high until end of 2017 and even continued in 2018.
if price were to fall because of high fees it had to drop after reaching $5k and never went any higher to $20k.

I mean, when the fee gets so high that you are paying as much for the fee as you are spending in your transaction, what good is Bitcoin?

bitcoin is the decentralized currency that you can use globally without needing any third party. it was never promised to be cheap. although i agree that fees should not be high.

There isn't as much decentralization in bitcoin as we think. All the big miners know who they all are. They probably contact each other now and again. They can easily get on the phone with each other, and time a rise in miner's fees for, say, the middle of December.

another nonsense.
there are a couple of million ASICs currently mining bitcoin that produce this much hashrate. some miners have more than one and there are farms so it means there is at least a million bitcoin miners that are spread around the globe. if you can't see decentralization in that then you are blind.

another nonsense part here is that miners don't set the fees, the users do in a competition for the scarce block space.

So, will we see a sudden miner fee rise this time? One that will bring Bitcoin crashing down like at the beginning of 2018?

no because as we already know the crash had nothing to do with high fees.

[Mahanton]

We are mooning now but look at the current rate of the fees?

Low priority
17 sat/vB ($0.44)
Medium priority
23 sat/vB ($0.59)
High priority
28 sat/vB ($0.72)

It might increase but not on the level on what we had experienced back in 2017.
Price wont crash similar into that year since the price at the moment is somewhat been backed
 strongly and not basing on pure fomo.

[sheenshane]

Will we see the joint-rise in miners fees like we did back in 2017? It's essentially the miner's fee rise that made Bitcoin drop.

Look at the mempool statistics, the chart shows of having a huge drop of Bitcoin's transactions which mean the fees aren't that high since mempool network isn't congested.  There's no correlation between the fees and the price movement in the market, still, the demand and supply were Bitcoin's price based.

..what good is Bitcoin?

As I can see, this isn't good for now of having frequent transactions or being used as a payment method, people are aware of the possible profit once they hold this and sell when the price is high.  The good advantage of Bitcoin is the possible safe-haven investment.

So, will we see a sudden miner fee rise this time? One that will bring Bitcoin crashing down like at the beginning of 2018?

I believed the price manipulation and continued spreading FUD news.  Regarding the miner's fee, it will increase if the network is congested that experiences heavy traffic due to the backlog of transactions and also pushes up transaction fees as demand outweighs supply.

[Upgrade00]

Firstly, Bitcoin fees are paid in Bitcoin and not in fiat, so when making comparisons do not covert it to fiat currencies to get the value; if the USD value of Bitcoin triples, the fees on transactions would also triple without any changes to the actual amount of BTC paid

There isn't as much decentralization in bitcoin as we think. All the big miners know who they all are. They probably contact each other now and again. They can easily get on the phone with each other, and time a rise in miner's fees for, say, the middle of December.

There is no telegram group for all miners, where they decide fees. It all depends on traffic. If I had the only transaction on the mempool (or all the transactions needed to to fill a block), I can pretty much send it with a very low fee as it will still definitely get confirmed due to no competition. Miners earn majorly from coinbase reward not fees and my transactions are needed to fill blocks.
If more transactions come in with a higher fee than mine, they are then given priority, if even more transactions with even higher fees are initiated they get pushed closer to the tip of the mempool and mine moves further down, meaning I have to bump the fees to compete for confirmation.
Miners play no part in this.

[chip1994]

Bitcoin's price crash is part of the whales' plan. There are practically only a handful of private Bitcoin miners, most of which more than 80% of the miners in the world are managed by whales. They manipulate both mining and use that Bitcoin source to increase power and manipulation of the market.
This conspiracy theory is quite true right now, things seem to go according to plan and the market is constantly pump and dump in a confusing way. Therefore, the increase or decrease of the cost is just an excuse for the whale to manipulate.

[2double0]

Fees already rose and dumped down and there will be ups and downs in it till Bitcoin remains a buzz in the market. I do not think that if the fees rise during this bull run, it will affect its price as there is so much positivity I can feel in my nerves about btc that the bulls are not going to leave btc before taking it into a 5 figure category.

[dothebeats]

When the fees are up, most normal traders are deterred to make their moves to sell. Only those who have their funds at the ready in exchanges are responsible for the price movements of bitcoin. Most do not even try to take out their money off of exchanges when a sudden significant rise is around, and they only do so when the momentum has died out or the price has stagnated for a while. You can say that whales spam the network when a crash is imminent, as that secures their profit already since not everyone will be fast enough to transfer funds, but that doesn't seem to be true nowadays considering that we are still rising and rising, and fees don't seem to go up albeit the stimulated market activity that we have been seeing for a few weeks now.

[Kupid002]

Fees already rose and dumped down and there will be ups and downs in it till Bitcoin remains a buzz in the market. I do not think that if the fees rise during this bull run, it will affect its price as there is so much positivity I can feel in my nerves about btc that the bulls are not going to leave btc before taking it into a 5 figure category.

The fee is not the main issue right now in Bitcoin as investment fees will only increase depending on traffic, so if you think the day you transfer BTC is asking high fees then wait for another day until it will became lower .

No idea why OP think it's a big problem we still far on the price  which will hurt everyone with the fee due to the high price of bitcoin.

[hatshepsut93]

Look at how Bitcoin is shooting up... just like it did at the end of 2017. Will we see the joint-rise in miners fees like we did back in 2017? It's essentially the miner's fee rise that made Bitcoin drop. I mean, when the fee gets so high that you are paying as much for the fee as you are spending in your transaction, what good is Bitcoin?

If this was true, than Bitcoin would have crashed to the ground and never recovered, because if scalability was a problem for investors, they wouldn't be investing until it's fully solved, and even Lightning Network is still not ready to be released.

There isn't as much decentralization in bitcoin as we think. All the big miners know who they all are. They probably contact each other now and again. They can easily get on the phone with each other, and time a rise in miner's fees for, say, the middle of December.

You're just speculating, your statements aren't based on any facts. You just believe in it because it sounds "logical" to you.

[error08]

The rising fee is one of the imperfections in the bitcoin system, it's not the fee but the way it always increases because people scramble to pay higher fees to get priority for their transactions. If everyone agreed to pay below 10 sats/byte, it will be okay for all of us, though it's not the case of what's happening in the market.
The fee rise whenever too many queues on the mempool, especially when it reaches over 60k transactions. Currently, there are over 22k unconfirmed transactions, with 32 sats/byte will take less than an hour to be confirmed.

[lionheart78]

Look at how Bitcoin is shooting up... just like it did at the end of 2017. Will we see the joint-rise in miners fees like we did back in 2017? It's essentially the miner's fee rise that made Bitcoin drop. I mean, when the fee gets so high that you are paying as much for the fee as you are spending in your transaction, what good is Bitcoin?

There isn't as much decentralization in bitcoin as we think. All the big miners know who they all are. They probably contact each other now and again. They can easily get on the phone with each other, and time a rise in miner's fees for, say, the middle of December.

So, will we see a sudden miner fee rise this time? One that will bring Bitcoin crashing down like at the beginning of 2018?

Miner's fee had surged a week ago since the Bitcoin network is congested but, it is all ok now, I think the miners fee in not related to the Bitcoin price increase, it is more on the transaction created in a period of time.  Like if within this moment a million transaction were created, it is sure that the network will be congested and senders will then compete to get confirmed first by increasing their transaction fee.  By then the transaction fee will dramatically increase due to the people wanting  their transaction to be confirmed first.

[blockman]

There's a huge difference for the fees during 2017 and this year. I was surprised that when I'm doing transactions in the midst of this rise, just a few minutes and it gets confirmed and note that I didn't pay the highest priority but just the lowest to average fee. The fee looks high in terms of $ but that doesn't mean that it's too expensive. I remember that there were instances on the last ATH that transaction fees has to be par with the amount you'll be sending and perhaps others have shown that it's more than the amount you were about to send.

[dunfida]

There's a huge difference for the fees during 2017 and this year. I was surprised that when I'm doing transactions in the midst of this rise, just a few minutes and it gets confirmed and note that I didn't pay the highest priority but just the lowest to average fee. The fee looks high in terms of $ but that doesn't mean that it's too expensive. I remember that there were instances on the last ATH that transaction fees has to be par with the amount you'll be sending and perhaps others have shown that it's more than the amount you were about to send.

It does mean that transactions are organic where buying power isnt really that on a rush where it did clogged up the entire network this is why i do see that
the current rise is having that established or something have that strong foundation where people do buy in without the need of a rush or shall we say that
people are tending to hold as they observe for the price to rise up.Theres no correlation with price and into its fees yet it is subjective to case to case basis
but it isnt right to presume that they do connect to each other.We know the flaws but talking on market price is always unknown.

[Bitcoin_bullish]

I remember fees being extremely high in 2017 after the failed Bcash flippening. And later Ver admitted he paid transaction fees of thousands of dollars probably because he just wanted to send a message that Bitcoin Cash was used for buying a coffee and Bitcoin wasn't. It was co-ordinated for fees to reach this high as it was some publicity stunt by Bitcoin Cash and wanted to make a point during a time of retail fomo on Bitcoin.

[blockman]

There's a huge difference for the fees during 2017 and this year. I was surprised that when I'm doing transactions in the midst of this rise, just a few minutes and it gets confirmed and note that I didn't pay the highest priority but just the lowest to average fee. The fee looks high in terms of $ but that doesn't mean that it's too expensive. I remember that there were instances on the last ATH that transaction fees has to be par with the amount you'll be sending and perhaps others have shown that it's more than the amount you were about to send.

It does mean that transactions are organic where buying power isnt really that on a rush where it did clogged up the entire network this is why i do see that
the current rise is having that established or something have that strong foundation where people do buy in without the need of a rush or shall we say that
people are tending to hold as they observe for the price to rise up.Theres no correlation with price and into its fees yet it is subjective to case to case basis
but it isnt right to presume that they do connect to each other.We know the flaws but talking on market price is always unknown.

That's plausible that most buyers don't end up speeding their transactions unless it's an important payment. But most likely, it's all coming from purchases for holding as the market shows that it's starting to rise or it has actually risen already.
The comparison of fees regards to the bitcoin price is common and sometimes treated as an expensive amount due to the value in US dollars which is the price pegged for bitcoin.

[Mike Mayor]

What are you talking about? None gets on the phone to talk together. Lol wow, you like to create your own conspiracies. I remember paying $20 for transfers during the 2017s high price burst. It was crazy & transactions took forever. Spending bitcoin because quite difficult since transactions didn't go through within the target time window for it to count the purchase. Which meant you had to send it again which cost even more bitcoin. I must have had to have spent a few $100 on transaction fees alone during that time.

[BADecker]

^^^ Just because they are busier than all get-out, do you think that they don't communicate? On the phone, possibly no... because the phone might be too inneficient for them. But one way or another.

[error08]

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So, will we see a sudden miner fee rise this time?

The case in 2017 is different compare to 2020, there are some improvements such as segwit and lightning network. We will find out in mid-December when the price on the rise to new ATH, although it's not the price but how many unconfirmed transactions on the mempool, it's a common issue in the bitcoin network. However, I don't agree about miners intently cooperate each other to pump the fee, simply there is no evidence to accuse them. Even these days, the fee relatively cheaper than in 2017.

[wiss19]

It’s very, very annoying. You’re not the only that hates this high fees of a thing. Imagine when you have to do just a little transaction and you have to pay a lot of money for a little transaction. Wanted to do a transaction of $50 the other day and my wallet was showing fees of almost $5, which means I had to spend $55 in total.

I have been looking for a solution to this problem. I once installed a wallet that claims to offer the lightening network feature, but I didn’t really trust them, so I had to uninstall it and go back to the normal wallet I was using. I’m still wondering how high the fees will be as the price is on its way up.