Angry at the high fees? That's what everyone predicted the future will be like!

[Myleschetty]

I think the reason people are dragging their feet about the high transaction fees associated with Bitcoin is that they do want to accept the benefits but ignore the drawbacks of the market experiencing large volumes of transactions. They want to see the price of the BTC holding rise or see widespread adoption.
They dislike the sacrifice it brought, but they welcome the advantage they will have from the market when BTC sees extreme traffic.
I accept this fact and choose to use the alternative. That's why I am never angry about the BTC tx fee.

[1714687435]

1714687435

[1714687435]

1714687435

[1714687435]

1714687435

[Lucius]

~snip~
So, as a conclusion or encouragement or whatever, don't be angry at the fees, they help secure the network, and this is how it was designed to be in the first place, otherwise, we would end up like Bitcoin Gold or Ethereum classic, shitcoins getting 51% attacked 3 times in a row.

I'm actually glad when the fees go up because then we see who are the ones who understand at least something, and who are the others who think that the fees should always be a maximum of $0.10, because not only is Bitcoin anonymous, but the transaction fee must always be super cheap.

On the other hand, the majority who withdraw their coins from CEXs never complain that they pay fees that are at a level even higher than the fees that happened these days - which means that they are ready to fill pockets of various crypto messiahs, but it is difficult for them to pay $2 to a miner for the transaction.

And of course, for now, we could actually start using LN rather than complaining, but that would be a solution that involves doing something!

For someone who has never used a non-custodial wallet, something like LN is a rather complicated science, and it will probably remain so for a long time.

[philipma1957]

LN has its own issues.

This fee level dropped a bit. last blocks are running a bit under 1 coin in fees.
See the pattern repeat year after year.



next spring with rewards 3.125 miners will really need fees to grow.


funny how

2016 25       coins to 2-3 btc fees not bad 
2020 12.5    coins to 2-3 btc fees bad
2023  6.25   coins to 2-3 btc fees = terrible
2024  3.125 coins to 2-3 btc fees = a miners dream a users nightmare

[joker_josue]

LN has its own issues.

This fee level dropped a bit. last blocks are running a bit under 1 coin in fees.
See the pattern repeat year after year.



next spring with rewards 3.125 miners will really need fees to grow.


funny how

2016 25       coins to 2-3 btc fees not bad  
2020 12.5    coins to 2-3 btc fees bad
2023  6.25   coins to 2-3 btc fees = terrible
2024  3.125 coins to 2-3 btc fees = a miners dream a users nightmare

Is there a way to control this escalation of future fees?

It's just that ways have gradually emerged for large miners to be able to influence network fees, and this could harm Bitcoin - a lot.
I believe that the entire Bitcoin community should think of something to avoid this control by (large) miners.

[philipma1957]

LN has its own issues.

This fee level dropped a bit. last blocks are running a bit under 1 coin in fees.
See the pattern repeat year after year.



next spring with rewards 3.125 miners will really need fees to grow.


funny how

2016 25       coins to 2-3 btc fees not bad  
2020 12.5    coins to 2-3 btc fees bad
2023  6.25   coins to 2-3 btc fees = terrible
2024  3.125 coins to 2-3 btc fees = a miners dream a users nightmare

Is there a way to control this escalation of future fees?

It's just that ways have gradually emerged for large miners to be able to influence network fees, and this could harm Bitcoin - a lot.
I believe that the entire Bitcoin community should think of something to avoid this control by (large) miners.

WELL all gear builders would have to have a world wide ban on mining. Frankly I can't see it as possible.

right now you have

buy and hodl
traders
users
miners
builders
software guys
pools

Blending all of the above is really hard to do.

As a miner high fees feel good.
As a seller of items using btc for my payment high fees suck.

So I am in a personal conflict of interest on 2 catagories.

I also trade a tiny bit the effect on trading is harder to understand
lastly I mine and hodl

so just me alone and I  am In a complex situation.

other absolute supermoon of btc price most of the time I have no idea what to root for ie multi hedged for safety’s sake.

[Davidvictorson]

I just paid nearly $70 in fees to move $300 between wallets. I have concluded within myself that I am going to avoid micro transactions as much as possible. Consequently, between miners that primarily self mine and miners that primarily host, I think that it is the miners with self mining that will benefit more from these high fees. What surprises me is that despite the high fees, it is not showing any negatives on bitcoin's price action.

[DaNNy001]

I just paid nearly $70 in fees to move $300 between wallets. I have concluded within myself that I am going to avoid micro transactions as much as possible. Consequently, between miners that primarily self mine and miners that primarily host, I think that it is the miners with self mining that will benefit more from these high fees. What surprises me is that despite the high fees, it is not showing any negatives on bitcoin's price action.

Wow that's some heck of a fee, a whooping 70$. For now I don't think I will be doing any transaction with Bitcoin as I have some asset in other cryptocurrency like USDT and will make due of those because I can't afford to spend that much in any transaction be it micro or macro. The lightening network solutions that was meant for this particular issues itself is slow in adoption, if not the lightening network would be the perfect resolved to this issue.

[tjtonmoy]

- if in the future we will pay 1 cent per tx we would have one cent worth of bodyguard
- if in the future we want to have the same level of security as now, we have to pay twice the fees we're paying in the last few blocks!

Again, nobody will be forcing you to do so, but....the are consequences if not!

I know this is a dumb question and I don't know much about it. That's why I'm asking. Can you please clear my doubt? We have lightning Network which good send Bitcoin faster and with low transaction fees. I don't know how that works and is it really the real Bitcoin we are sending, but is it possible in the future too only use lightning network in order to face this situation?
I get the idea of running everything and not getting any mining rewards for that. And only thing you get is the fee you get from completing in transactions. They are going to accumulate income from fees, so of course they will charge us more. But is there any other alternative for this? That's why I was talking about lightning network! Is it possible or I just sound totally dumb. 

I'm not asking from curiosity rather I really don't know anything about it. Hope you can help me.

[Fivestar4everMVP]

At this point it is becoming confusing. I read somewhere that the high fees is as a result of Ordinal or NFTs on the Bitcoin network. According to the said comment, the Ordinals is a new trend that is massively being traded, hence the congestion of the Bitcoin network.

I do know that this is not the first time I'm witnessing the situation we are facing now. So it becomes confusing knowing what to believe to be the cause of the high fees and if there is any other way around it with respect to the future because fees like this is a kind of discouraging!

Ordinals were indeed the cause of high fees on the bitcoin network, but not for this that we are currently experiencing, the congestion on the bitcoin network as a result of ordinals was something that happened several months ago, i do not think it is still the same reason that brought about the current congestion we are seeing at the moment.

Though i myself is also confused, but just as OP have said, the high fees help secure the network, but the truth is that, this is not entirely very nice, most especially for those who don't own a lot of bitcoins and does little transactions every day

Thank goodness for lightening network, but another problem we have here is that, not very many people know about this technology or how to set it up, i guess this is the time we start talking more about the bitcoin lightening network, so as to bring this awareness and knowledge to as many as possible, maybe this will also help to lessen the transactions on the main network, which will also bring fees down from its highs.

[SamReomo]

I agree with you with all those things that you have mentioned in your thread. I also believe that higher fees can incentivize the miners with better rewards for all the work they're doing for themselves and for Bitcoin community. Without miners we won't be able to do anything with Bitcoin and that's why I believe the high fees are more like thanksgiving to those miners who are doing the hard work of mining and making it easy for us to enjoy Bitcoin transactions.

Surely, the high fees have their own drawbacks but since miners are getting some good pay for their work and that's why we should accept it for the time being. I hope that soon we'll see good fees again and the transactions with low fees will also get accepted sooner than expected. This time the high fees are again on the network because of the ordinal thing but surely if miners are getting rewarded for your work then we should not a say a word in this matter.

I believe that in such times we can choose another altcoin based transactions if the transactions are that necessary and allow Bitcoin network to get stable once again in order to use it. I believe Monero could be a good choice for such times as transactions made with Monero are also decentralized in nature. I also agree that using of LN is another option for us and now LN is getting more widely accepted so it's going to be a good option for us.

[wallet4bitcoin]

It's undisputable. The more the prices of the coins get the more the fees increases. I don't see a cap being placed on the fees charged by Blockchains and this is a great concern for users especially the Ethereum Blockchain, the gas fees goes as high as $300 and its not even on priority fees.

Who wouldn't get angry, and worst of it all, you get to pay gas fee and the transaction fails.

[ragnise2]

I do know that this is not the first time I'm witnessing the situation we are facing now. So it becomes confusing knowing what to believe to be the cause of the high fees and if there is any other way around it with respect to the future because fees like this is a kind of discouraging!

[franky1]

miners currently get a block reward of 6.25 which at a years market average of $30k/btc =$187,500
(lets use this $187k as a mining cost break even per block)

when 1btc is $150k the 3.125btc $486k
pools wont need to be subsidised by fee's because they are getting 2.5x even after a reward halving

the cost to perform an attack raises by 2.5x simply by spot market change. without the need to include fee's becasue miners can then hash more feore next break even point

if you think pools need 3btc in fee in 2024, you dont understand economics

its much like saying in 2015
'next year reward halves from 25 to 12.5 we need to make fees per block total 12.5 to compensate'
no.. you instead need the market spot price to increase (as it does) then fee's still remain non-important


as you can see we didnt need in 2016 for fees to be 12.5 to compensate the halving
as you can see we didnt need in 2020 for fees to be 6.25 to compensate the halving
                                                                          18.75 to compensate two halvings  

fee's do not need to compensate halvings so no we dont need 3.125 fee's total per block in 2024

..
what we should do however is without causing individual users to pay $70 per tx (+3500tx average 2024) = $245k in fee's
we need to realise the spot market can take care of the reward value.. and increasing the number of transactions per block will take care of fee total

..
also by having excessive fee's means users dont use bitcoin and also pools sell coins cheaper because instead of having just 6.25($187k) cost/reward they have 432k of reward+fee for only $187k cost. meaning they can sell the coin 2.3x cheaper than the current price and break even, thus ruining the market value which then ends up needing more fee's in a snowball effect.

[stompix]

Not necessarily need to pay, if only the Bitcoin scalability issue is solved, then we won't be paying the transaction fee that much.

Unless that scalability involves cheaper and more fees rather than high but only 400k fees a day then there is no other scalability method that will work, and this one will only be solved with... increasing something.

2. you also did not figure into it that if 2million asics costs $Xbillion amount of electric per year the PRICE IN DOLLARS per sat can increase without needing the sat per byte to increase.
infact with the prices per dollar increasing, the sat per byte should be dropping

The whole Satoshi thing is irrelevant to a miner.
A miner pays $1 for equipment it pays 1$ for energy day, he knows he has to get more than 1$ to cover the cost and more than 0.003 to recoup the investment in a year. If the revenue per day goes below 1$ he shuts down as it's more profitable to buy the coin and wait.
As long as electricity is priced in $ and it doesn't fluctuate according to Bitcoin price it would be stupid to do the math otherwise.

bitcoin was not designed to pay asic farms millions of dollars per block. asics farms were not even a thing when bitcoin was invented.

The internet wasn't to replace television, but here we are, doubt people in 1970 thought they would have hundreds of petahash of porn stored in the cloud with 100 MW data center spread across the globe, but here we are, billions spend to store and deliver porn!
Because it's offer and demand that dictate everything in this world, not the intentions of the guy who designed it.

Is there a way to control this escalation of future fees?
It's just that ways have gradually emerged for large miners to be able to influence network fees, and this could harm Bitcoin - a lot.
I believe that the entire Bitcoin community should think of something to avoid this control by (large) miners.

Raise the capacity of the network.
Or play NIMBY and watch fees go the way home prices do in cities all over the world.

I know this is a dumb question and I don't know much about it. That's why I'm asking. Can you please clear my doubt? We have lightning Network which good send Bitcoin faster and with low transaction fees. I don't know how that works and is it really the real Bitcoin we are sending, but is it possible in the future too only use lightning network in order to face this situation?

Only LN? No!
You still need an on-chain transaction for starting to use LN, so the network capacity must still be large enouhg to allow millions of channels to be opened and closed. But since nowadays usage is limited, it would cover it pretty much, the long term it will still need a capacity increase.
We are billions! on this planet. There is no mass adoption without billions using it!

I get the idea of running everything and not getting any mining rewards for that. And only thing you get is the fee you get from completing in transactions. They are going to accumulate income from fees, so of course they will charge us more. But is there any other alternative for this?

Misconception.
The miners don't charge you anything, they simply include the biggest tx in terms of fee in the next block.
Think of it more like an auction than a ticket sale, you want to pay for what you do, if there are more people auctioning you have to pay more if there is only you you get it as cheap as possible.
The miner has no saying in this, 1sat/vb or 500 sat/vb if there is space he will include you.

The best analogy would be :
https://en.wikipedia.org/wiki/Pay_what_you_want

Your customers pay more than normal on it, you're happy and you offer better services, they pay the same you offer standard service, they don;t pay at all you go bankrupt.  

So bottom line LN is a solution, but just as 1MB blocks were a solution till we hit a demand of more than 500k tx a day, LN won't be able to deal when it hits (if it ever does) numbers in the high tens of millions of daily usage.

~snip~
So, as a conclusion or encouragement or whatever, don't be angry at the fees, they help secure the network, and this is how it was designed to be in the first place, otherwise, we would end up like Bitcoin Gold or Ethereum classic, shitcoins getting 51% attacked 3 times in a row.

I'm actually glad when the fees go up because then we see who are the ones who understand at least something, and who are the others who think that the fees should always be a maximum of $0.10, because not only is Bitcoin anonymous, but the transaction fee must always be super cheap.

That's it basically, everything has a price, even privacy, you can go for free with tor and wait two hours for a movie or pay for a VPN and load it in seconds. Best way to hide your identity, a burner phone, but, that costs money! 
What I love about it is that when fees skyrocket there is always an ostrich who will come and say but Bitcoin was not supposed to be for small transactions, it's for moving large amounts of money, seeing how cheap it is to transfer millions for $5? Like that's the number one problem everyone faces, how to pay $ instead of $1000 when sending $40 million!

pools wont need to be subsidised by fee's because they are getting 2.5x even after a reward halving

Do me a favor and read the first post again:

Every single time a newbie asked what would happen when there would be no mining reward he got the same response over 10 pages, miners will live on from fees

[philipma1957]

I just paid nearly $70 in fees to move $300 between wallets. I have concluded within myself that I am going to avoid micro transactions as much as possible. Consequently, between miners that primarily self mine and miners that primarily host, I think that it is the miners with self mining that will benefit more from these high fees. What surprises me is that despite the high fees, it is not showing any negatives on bitcoin's price action.

Or it is and we should be at 41 to 45k. Not 37k

[franky1]

The whole Satoshi thing is irrelevant to a miner.
A miner pays $1 for equipment it pays 1$ for energy day, he knows he has to get more than 1$ to cover the cost and more than 0.003 to recoup the investment in a year. If the revenue per day goes below 1$ he shuts down as it's more profitable to buy the coin and wait.
As long as electricity is priced in $ and it doesn't fluctuate according to Bitcoin price it would be stupid to do the math otherwise.

and hobby miners around the world do that if their costs get higher then market rate. but hobby miners are not the value setters

asic farms PRE BUY hardware of 2 year life cycle. they also PRE BUY 2 year of xMW electric contracts. so they just mine no matter what as they have 2 years of electric.. (dont use it, lose it)
so they mine constantly and then tally up the rewards. and decide not to sell at a loss..

its this basic principle that causes the "support" line of value that sits below the market. where no one wants to sell below
this support line bottom them helps push the market price up..

its basic economics. if the cheapest way to acquire bitcoin on the planet (efficient mining) was $15k in 2022. no one on the same planet wants to sell below $15k. so market stays above $15k.
we are in 2023 in a support value bottom line of ~$24k so its safe to say the market wont bottom out below that.
the movement of the underling cost of most efficient also pushes the speculation for the rest up

EG it used to cost hawaii-japan $75k in 2021 104k in 2022 and now its 150k+ in 2023
if you learn about the value vs premium of world economics of bitcoin you then learn the window of which the market spot price speculates within

yep hawaii-japan being most expensive to mine so when in 2021 their mining cost were $75k they were the ones happy to market buy upto the $70k ATH of 2021
they would be the ones happy to buy upto $150k this year if speculation pushed so hard

we are no longer in the days where the value-premium window is $800-$20k in 2017 those old s9 asic cost days are over and the market has shown and proved it

[stompix]

its basic economics. if the cheapest way to acquire bitcoin on the planet (efficient mining) was $15k in 2022. no one on the same planet wants to sell below $15k. so market stays above $15k.
~
EG it used to cost hawaii-japan $75k in 2021 104k in 2022 and now its 150k+ in 2023
if you learn about the value vs premium of world economics of bitcoin you then learn the window of which the market spot price speculates within

yep hawaii-japan being most expensive to mine so when in 2021 their mining cost were $75k they were the ones happy to market buy upto the $70k ATH of 2021

Franky, just f*** stop!
Nobody cares about the electricity prices when it comes to the price of Bitcoin.
If it were like that and people in Japan would pay 70 000 then people in Venezuela would sell it for $10.

I mined it Europe at well below average electricity prices, I stopped mining with all of them selling a few when mining was not profitable anymore, no way in hell I'm going to pay more for a BTC because my electricity prices are higher than in Russia or China or India.
You're living a complete delusion, to you it would be normal for people in Japan to pay $5000 for a barrel of oil cause that's the cost they would have to pay to extract it from the bottom of Mount Fuji, no it doesn't work like that!!!

Also, stop with the numbers pulled out of your ass:

https://www.sec.gov/Archives/edgar/data/1167419/000107997321000537/ex99x1.htm

Whinstone’s comprehensive energy management strategy delivers best-in-class net energy costs of approximately 2.5 cents per kWh utilizing cutting-edge technology and comprehensive analytics to deliver industry-leading low cost, reliable and responsive power.

https://www.sec.gov/Archives/edgar/data/1507605/000149315219013483/ex99-1.htm

The Miners will be placed into service in a Co-Location hosting facility with electricity costs of $0.035 per KwH and $0.02 per KwH for the all-in hosting management.

https://www.sec.gov/Archives/edgar/data/1819989/000095017022008712/cifr-ex99_1.htm

Cipher’s weighted average power price is 2.73 c/kWh

https://www.sec.gov/Archives/edgar/data/1710350/000121390022012660/ea156889ex99-1_bitdigitalinc.htm

Pro forma for hosting agreements signed to date, we expect to enjoy a competitive base power and hosting rate of approximately 3.7 cents per kilowatt-hour

Stoppppp!!!!!!!!!

[HideYourKeys]

Once the ordinals trend ends we will get back to "normal" fees

[serveria.com]

Yes, another fee topic, deal with it! 

I know, nobody likes to pay fees, nobody! Me neither!
And if there is an exception for sure it doesn't want to pay high fees, so it's pretty understandable that everyone is unhappy about it!
But at the same time, why are you angry at the same situation everyone was believing in it and predicting it?

Every single time a newbie asked what would happen when there would be no mining reward he got the same response over 10 pages, miners will live on from fees, and the security of the blockchain will be generated from fees! And here we are, although the fees are not quite high enough yet!

The last block:
https://mempool.space/block/00000000000000000002745f5dc332c3f8373773c05f3507c51bbfb4e402359b
generated :

Total fees   ‎3.257 BTC$119,069
Subsidy + fees   ‎9.507 BTC $347,557

so in order for the fees to replace the reward, you would need twice as much already, even despite this:

Fee span   280 - 8,206 sat/vB
Median fee   ~299 sat/vB $15.31

To make it as short as possible, for the network to have the same security as now without a block reward we would need each block to have twice as big fees in the future, that's how things work!
So, are you angry with high fees? Yes, we all are, but, wasn't this the design?

Before anyone comes up with some myths about this, let's clear some things

1) More efficient gear isn't making the network more secure alone, what's making the network secure is the amount of $ to invest to generate that hashrate, so if you think more efficient gear will mean the network will be just as secure but cheaper, it's delusional.
Right now the network is guarded by 400Exahash, which alone doesn't mean a thing, you must translate those into 4 million $2000 a piece machines to understand the security right now, as it takes 8 billion to launch a 51% attack. This also doesn't mean that because the hashrate in 2013 was one million lower you could attack it at that time with just 8000$ 

2) Cheaper energy or solar or renewable or anything else, again won't solve a thing, even if we run our gear on 0.1 cents per kWh if the reward per day is just $1000 you will only be able to afford 1Gkwh, so anyone willing to spend more than $1000 on energy will have the upper hand!

So, as a conclusion or encouragement or whatever, don't be angry at the fees, they help secure the network, and this is how it was designed to be in the first place, otherwise, we would end up like Bitcoin Gold or Ethereum classic, shitcoins getting 51% attacked 3 times in a row.

And of course, for now, we could actually start using LN rather than complaining, but that would be a solution that involves doing something!

Frankly, I didn't investigate the latest fee moonshot but I guess the reason is still the same: ordinals, brc20 and other shitty tokens. If we extract the number of spam transactions from the total amount, we'll most probably realize the things are not that bad. Yes, we will face the high fees from just the natural, legit transactions alone but much much later. Who know what will happen then? LN adoption, hashrate drop, quantum tech, renewable energy use... who knows? Right now #1 issue is to stop the goddamn monkey tokens, that will solve our problems for now.

[philipma1957]

Once the ordinals trend ends we will get back to "normal" fees

for a bit then we will uptick again. There are vested interests that want more than just btc in the market.

So every once in a while fees will get forced up.