Road to 1sat/vb! Destination in sight?

[BlackHatCoiner]

I hope we see 1 sat/vb soon, but I doubt it. 1 sat/vb paying transactions are on the bottom of a mempool which can fill 169 blocks, at the moment. Meaning, you'd need to wait for about a whole day, with nobody making any new transactions, so that you reach 1 sat/vb.

Your statement is still wrong.  The goal of Bitcoin was never to have more expensive Transactions with time.  This was a problem that came up with time, not a goal.

The goal is to have a congested network, because a hard capped network like Bitcoin that does not have tail emission is reliant on transaction fees. Therefore, there have to be a lot of transactions.

Transactions (on-chain) being expensive is a side effect of that goal, because of the scarcity of the small block space.

[MeGold666]

How did Lightning Network fail?  Because it did not bring enough Bitcoin users to be part of it until today?  Bitcoin is still pretty hard to learn, Lightning makes things even more complicated in my opinion.  This does not make Lightning a failure.  It was more of an experiment anyway.  Bitcoin is an experiment itself.

It has scalability problems, it has privacy problems, it has centralization problem, it has user experience problem.

It was (and still is) used as the ultimate answer for every Bitcoin shortcomings by the lemming population who copy/paste outdated/false information.
This is one of the reasons why Bitcoin protocol is outdated today because "L2" solutions will fix it.
Now some people try to belittle it by saying "meh it was only a test project" and point to another project while not realizing Bitcoin can't handle any L2's because as network gets congested nothing gets passed like we have seen with LN failing in the first batch of ordinal spam this year.

It failed at everything it promised for so many years and current state is so unfixable that one of the main devs abandoned the project because current exploitable behavior can't be fixed without changing Bitcoin protocol.

That's how.

[Franctoshi]

I hope we see 1 sat/vb soon, but I doubt it. 1 sat/vb paying transactions are on the bottom of a mempool which can fill 169 blocks, at the moment. Meaning, you'd need to wait for about a whole day, with nobody making any new transactions, so that you reach 1 sat/vb.

Your statement is still wrong.  The goal of Bitcoin was never to have more expensive Transactions with time.  This was a problem that came up with time, not a goal.

The goal is to have a congested network, because a hard capped network like Bitcoin that does not have tail emission is reliant on transaction fees. Therefore, there have to be a lot of transactions.

Transactions (on-chain) being expensive is a side effect of that goal, because of the scarcity of the small block space.

I actually still do not believe this is something that will be possible basically because we are yet to see a full-blown up bull market we used to have where a lot of people would FOMO into the market, and priority would be paid to transactions with higher fees, and we may once again resume to witnessing another high fees, for now, let's just enjoy the fact that the fees are almost at its floor after we all witnessed the high level of congestion of the mempool few months back.

[franky1]

You don't want cheaper transactions in Bitcoin as miners are already struggling to stay alive with the block reward that was recently cut-off by 50%.

The goal of Bitcoin is to have more expensive transactions with time.

If you cheer the idea of "There will only be 21M" then you should also cheer whenever tx fee goes up.

wrong
miners are not paid per transaction so they dont need every transaction to pay more
instead realise in the last 10 years average global internet speed has increased as has the average size hard drive and ram sold in a PC. meaning transaction count(number of transactions) per block can increase, so that each transaction does not need to pay more

also to note pre halving an average btc price was below $25k now its above $50k so the btc market helps miners.. thats the whole concept of deflation.. learn it

also compared to 10 years ago the efficiency of relaying, propagating and validating has changed which adds more efficiency to make it possible to allow more transactions per block without throttling the network.

and lastly, no this is not an opportunity for you to scream 'lets leap to 1gb blocks' as a propaganda rebuttal, to insight debate to cast away any possibility of scaling bitcoin via that divisive argument.. instead realise that market deflation helps miners not need a 2x fee increase so often and with that, periodic transaction scaling(not leaping) more bitcoin transactions would help not just keep fees reasonable but also allow more transacters transact

other things can be done too to reduce spam/bloat transactions to further utilise the space to allow more genuine transacters

[PrivacyG]

The goal is to have a congested network, because a hard capped network like Bitcoin that does not have tail emission is reliant on transaction fees. Therefore, there have to be a lot of transactions.

Transactions (on-chain) being expensive is a side effect of that goal, because of the scarcity of the small block space.

Interesting how you see it.  Correct me if I am wrong, but I think the Transactions being expensive is a side effect of the Deflationary aspect of Bitcoin rather than a side effect of the Congestion.  If Bitcoin was not Deflationary, the Price would have never been high enough to consider the Fees expensive.  It could even be a psychological effect of how small Fees seem at first glance when choosing them in a Wallet, since I almost never see the Fee in USD but rather in Satoshis per vByte and Fees often seem way cheaper than they actually end up being.

Am I missing something here?

it has privacy problems, it has centralization problem, it has user experience problem.

Solve Privacy with out the Governments coming really harsh on Bitcoin.

Centralization?  Where?

How do you solve the User Experience problem of a system that gives everybody the power of being their own Bank?  You can not make it too simplistic because then you would hide very important information.  I mean.  A Wallet that is extremely simple to use can be created, but then again important details will be lacking and that is not alright in my opinion.  The problem of User Experience is not in the Bitcoin protocol but in the Software Wallets currently existing around.

[philipma1957]

You don't want cheaper transactions in Bitcoin as miners are already struggling to stay alive with the block reward that was recently cut-off by 50%.

The goal of Bitcoin is to have more expensive transactions with time.

If you cheer the idea of "There will only be 21M" then you should also cheer whenever tx fee goes up.

part true. frankly people don’t want to $5 worth of btc to move $25 worth of btc.

and 144 x 2000-3000 is 288,000 to 432,000 tx possible in a day. (very general number but gives you an idea of the limits to the chain.

 A simple LN ver 3 could help handle this.

Time will tell if they fix this.

[avikz]

After months of constantly checking the mempool, calculating fees, waiting for weekends, using coin control to save $2-3 on each tx, finally I can see the light, fees are down to just 6 sat/vb, and finally seems like there is no more spam! Not even these market swing haven't pushed people to move coins from and to exchanges, the mempool will be hopeful soon drained and we can finally not care anymore about sending even a few tens of dollars worth of BTC, consolidate our inputs with pennies and not having stuck funds cause somebody was a cheap bastard!

6sat/vb or 50 cents for a simple tx is normal now, will we see it 6 times cheaper?

How long do you think it will take to reach this target? Days, weeks, months?
I'm so optimistic I will say two weekends from now!

I would say it's temporary! You will see the volume of translations increasing again if the price goes up. However, it's also important to be cautious, as unexpected events can quickly change the scene. Your prediction of two wees might be on the optimistic side, but it's not entirely out of reach if current trends continue and no major market changes occur.

By the way, what about the ordinals? Have they been removed from the network completely? I am unable to find any news related to that so I guess it's still the same. If the activity of BRC-20 tokens pick up, the network may see some congestion again and may not show any fees reduction. For me, it feels like a temporary scene.

[Apocollapse]

By the way, what about the ordinals? Have they been removed from the network completely? I am unable to find any news related to that so I guess it's still the same. If the activity of BRC-20 tokens pick up, the network may see some congestion again and may not show any fees reduction. For me, it feels like a temporary scene.

Nope, the developers haven't remove inscriptions completely from the network. It just an idea by Luke Dash Jr to ban inscriptions, but not many people agree with that.

Even though the fees going lower and lower, but there are still many inscriptions, here's the recent block that has been mined. But, that's the good thing it means even though developers did nothing, the BRC-20 tokens hype is over.

[franky1]

You don't want cheaper transactions in Bitcoin as miners are already struggling to stay alive with the block reward that was recently cut-off by 50%.

The goal of Bitcoin is to have more expensive transactions with time.

If you cheer the idea of "There will only be 21M" then you should also cheer whenever tx fee goes up.

part true. frankly people don’t want to $5 worth of btc to move $25 worth of btc.

and 144 x 2000-3000 is 288,000 to 432,000 tx possible in a day. (very general number but gives you an idea of the limits to the chain.

 A simple LN ver 3 could help handle this.

Time will tell if they fix this.

again the failed economics of that thought is the less people transacting the less fees go to a block reward meaning the less that can be split to go to each miner.. whereby then even the miners cant then spend their rewards as they are locked to a pool whom it would cost a miner alot to split the coin away from the pools reward(yep shooting self in the foot)..
the solution again is not less transactions per block with high fee per tx that remain in a block.. the solution is more transactions per blocks so each tx pays less, but where the total accumulates per block total

10 years ago the network had no problems handling 2k-3k tx.. and many things have moved on, apart from tx count totals.
we could have easily done things to utilise lean transaction, fee formulaes, bloat penalising and other things so that when devs finally agreed that 4mb was network safe we could have easily 4x+ the average tx count to get to ~12k+ tx count per block. we could have also then scaled a few increases(emphasis on scale not leap) in the last 8 years to further that. but instead idiots went with the model of less transactions and more fee's which is the opposite of good economics.

as for some idiots thinking we desparetly need fee's in the era of 2020-2030 they have no idea about bitcoin economics of the market price deflation work.
again the market price deflation will look after miners for many halvings to come. what we should do is not shoot the foot to spite the toe, leaving bitcoin staggering around. instead we should be doing things to help bitcoin walk forward. not limp

[BlackHatCoiner]

If Bitcoin was not Deflationary, the Price would have never been high enough to consider the Fees expensive.

It doesn't work that way. Fees are primarily determined by block space competition. Back in 2012, you would notice transactions paying even ~0.03 BTC as a transaction fee, but that's because it was an unimportant amount back then. A few years later, it declined, because of the abrupt rise in price. But, if you look closely, you can see that, in dollar terms, these fees were all unimportant. And if you search the blocks at that time, you'll notice there were even transactions paying nothing at all, a feature that was advertised at that time, in favor of Bitcoin. (Misleading, as on-chain transactions wouldn't always stay at 0.)

Just because Bitcoin is deflationary (in terms of USD/EUR purchasing power), it doesn't influence the transaction fee. Remember, you can choose to enter any fee you want. If When Bitcoin goes to $1M, then instead of 1 sat/vb (which is currently unimportant), you could use 0.01 sat/vb. But, what will drive you to increase it, is competition.

And it is true that there has to be competition for Bitcoin to survive. Which, incidentally, results in high fees becoming the status quo.

[franky1]

If Bitcoin was not Deflationary, the Price would have never been high enough to consider the Fees expensive.

It doesn't work that way. Fees are primarily determined by block space competition. Back in 2012, you would notice transactions paying even ~0.03 BTC as a transaction fee, but that's because it was an unimportant amount back then. A few years later, it declined, because of the abrupt rise in price. But, if you look closely, you can see that, in dollar terms, these fees were all unimportant. And if you search the blocks at that time, you'll notice there were even transactions paying nothing at all, a feature that was advertised at that time, in favor of Bitcoin. (Misleading, as on-chain transactions wouldn't always stay at 0.)

Just because Bitcoin is deflationary (in terms of USD/EUR purchasing power), it doesn't influence the transaction fee. Remember, you can choose to enter any fee you want. If When Bitcoin goes to $1M, then instead of 1 sat/vb (which is currently unimportant), you could use 0.01 sat/vb. But, what will drive you to increase it, is competition.

And it is true that there has to be competition for Bitcoin to survive. Which, incidentally, results in high fees becoming the status quo.

strangling the tx count to get a premium is not good economics. far better to allow more users who pay reasonable fee
you dont need to strangle the size of the block to force only 3k transactions.. pools can choose the min fee they accept, and the max tx they want to include even if there are masses of space, they are not forced to fill a block, they are not forced to empty block. pools can decide what they want to go in. it does not require putting a stranglehold on the blocksize

infact even if blocks had a capacity of say 16mb pools could fill a block and if the block had propogation delays, thats no reason to lower the blocksize instead pools would decide to half fill the block and find the right level that they still get to be fastest first propagation to be the next blockheight. even if the blocksize code limit is higher then the real world resulting block content average
(take 2009-2013 when block code was 1mb but blocks only contains <0.5mb)

yep the code of blocksize limit is the thing that doesnt influence competition. its the mining pools decisions over what they decide to have included that does.. having a block limit is just pure dev politics to promote annoyance to advocate for other networks to be used.. other networks they designed for sponsorship income. it has nothing to do with technicals of economic growth. limiting blocksize has the opposite causality on economic growth

having wallets that 'bump fee' in huge increments is again not good economics. its just dev politics pools can decide to ignore transactions under a set fee even if there aren't that many transactions waiting. it doesnt require core dev politics to make it too expensive to use bitcoin under the premiss of helping the mining pools. the mining pools can choose what to include or ignore themselves

[MeGold666]

Centralization?  Where?

Everywhere.

There are plenty of studies about this matter:
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0225966

How do you solve the User Experience problem of a system that gives everybody the power of being their own Bank?  You can not make it too simplistic because then you would hide very important information.  I mean.  A Wallet that is extremely simple to use can be created, but then again important details will be lacking and that is not alright in my opinion.  The problem of User Experience is not in the Bitcoin protocol but in the Software Wallets currently existing around.

UX does not need to be complicated, users don't need to know what's in the background.

Do you need to know how engine works in order to drive a car ?
How many people would drive a car if this knowledge was a requirement ? not many.
And should they care how it works in order to use it ?

Imagine being required to know how VISA/Mastercard works in the background by average Joe in order to use it.
Average user doesn't care and shouldn't be required to care about any details.

It's more of a theoretical talk as LN arrived at a dead end.

[PrivacyG]

UX does not need to be complicated, users don't need to know what's in the background.

What type of information is generally displayed and not necessary in a Bitcoin Wallet?

Do you need to know how engine works in order to drive a car ?
How many people would drive a car if this knowledge was a requirement ? not many.
And should they care how it works in order to use it ?

Imagine being required to know how VISA/Mastercard works in the background by average Joe in order to use it.
Average user doesn't care and shouldn't be required to care about any details.

This argument is silly.  Who says you need to know what happens in the background when Spending or Receiving Bitcoin?

Except a few terms you need to look up to understand, such as Mining Fees, Blocks, Confirmations et cetera, it is pretty straight forward.  It is not like a Bank is straight forward to use any way.  You still have a lot of terms you need to look up, you do not just log in to an Internet Banking interface, write the name of the Receiving person, write down the Amount and press 'Send'.  You need to know what an IBAN is, maybe Swift or BIC, what an Account Statement is if you need to prove you paid et cetera.

Bitcoin is straight forward.  You only have the more advanced details at hand if and when necessary.

[MeGold666]

What type of information is generally displayed and not necessary in a Bitcoin Wallet?

We were talking about LN, remember ?

How do you solve the User Experience problem of a system that gives everybody the power of being their own Bank?  You can not make it too simplistic because then you would hide very important information.  I mean.  A Wallet that is extremely simple to use can be created, but then again important details will be lacking and that is not alright in my opinion.  The problem of User Experience is not in the Bitcoin protocol but in the Software Wallets currently existing around.

The whole UX of LN is fucked up. I don't know what "important" details you were talking about as you wrote about it.

This argument is silly.  Who says you need to know what happens in the background when Spending or Receiving Bitcoin?

Yeah, just tell average Joe to open channel on LN  
Unless you don't care about decentralizaiton (which is F-UP anyway), then you can tell him to use x service.

Remember: Average Joe does not care about decentralization and all the "mumbo-jumbo" we like - all he cares for is the transaction to be fast, cheap and easy.
They can already achieve this by using different project without any L2's needed.

If it's more than "scan QR code" and click OK to pay (while being fast and cheap) - people won't use it.
Why ? because there are alternatives that are already doing it in cryptocurrency space on L1, why should they care about clusterfuck called LN ? or any other "solution" on top of Bitcoin ?

It's called competition and Bitcoin must evolve (a lot) in order to stay significant because "number goes up" only goes so far.

[SilverCryptoBullet]

Every halving people make the same claim and every cycle we only see hashrate rising since miners are making more money than you think.

Not all Bitcoin miners can make money. They are like investors or traders or speculators and can be smart or stupid.

If miners join the Bitcoin mining industry with FOMO, without plans for their mining business, without financial reserve for their operations when Bitcoin price has problems, falls down a lot and cause loss in short term, they will have to shut down their ASICs or have to sell their bitcoins monthly to pay electricity bills and other expenses for ASIC, ventilation system maintenance and more costs. There are capitulation times from weak and not smart Bitcoin miners.

In bull runs, Bitcoin miners get more money from fees as fee per reward percent increases a lot in bullish months.

I agree with you that with time and each new Bitcoin cycle, new halvings, there are more Bitcoin miners work to support the Proof of Work blockchain because they see chances to get profit and many of them actually get profit from mining.

https://www.lookintobitcoin.com/charts/bitcoin-hashrate-chart/
https://www.lookintobitcoin.com/charts/hash-ribbons/
https://www.lookintobitcoin.com/charts/bitcoin-miner-revenue-total/
https://www.lookintobitcoin.com/charts/bitcoin-miner-revenue-fees-vs-rewards/

[Dave1]

After months of constantly checking the mempool, calculating fees, waiting for weekends, using coin control to save $2-3 on each tx, finally I can see the light, fees are down to just 6 sat/vb, and finally seems like there is no more spam! Not even these market swing haven't pushed people to move coins from and to exchanges, the mempool will be hopeful soon drained and we can finally not care anymore about sending even a few tens of dollars worth of BTC, consolidate our inputs with pennies and not having stuck funds cause somebody was a cheap bastard!

6sat/vb or 50 cents for a simple tx is normal now, will we see it 6 times cheaper?

How long do you think it will take to reach this target? Days, weeks, months?
I'm so optimistic I will say two weekends from now!

I would say it's temporary! You will see the volume of translations increasing again if the price goes up. However, it's also important to be cautious, as unexpected events can quickly change the scene. Your prediction of two wees might be on the optimistic side, but it's not entirely out of reach if current trends continue and no major market changes occur.

By the way, what about the ordinals? Have they been removed from the network completely? I am unable to find any news related to that so I guess it's still the same. If the activity of BRC-20 tokens pick up, the network may see some congestion again and may not show any fees reduction. For me, it feels like a temporary scene.

No, they are still in then network completely that's why there will be spikes in the tx fees.

We are still have ~200,000 transactions right now, we need to clear that out in the next coming days to see 1 sat/vB.

However, it's not that easy, as again, there could eb BRC20 tokens activities and it might cause the fees to go up again.  But good to see that we are not in the double digit as the price is somewhat in the 5-7 sat/vB.

[pooya87]

So how the network suppose to survive on low-fees when there will be not enough block reward to sustain the mining operation ?

What is there to convince people from using something that costs them a lot of money instead of moving to an alternative that has very low fees and does pretty much what Bitcoin does?

This is the biggest problem of Bitcoin - instead of fixing known issues with known solutions, people just wish everything will be alright.

To fix a problem you have to first understand the problem correctly.
Here, you keep thinking about miners and their revenue and don't care about anybody else. You are forgetting that it is people who are creating those transactions and expensive transactions is not a sustainable solution in long term.

Not to mention that at current prices, miners don't even need the extra revenue generated by increased fees to remain profitable. Not now and not in the near future.

[MeGold666]

Not to mention that at current prices, miners don't even need the extra revenue generated by increased fees to remain profitable. Not now and not in the near future.

They are already jumping ship and replacing ASIC's with HPC's as AI learning gives them more stable income.

Two more halvings and you can say goodbye to Bitcoin.

Maybe some years later I'll create a YT channel called "Forgotten Cryptocurrencies" and mention Bitcoin as people are quick to forget.

[BlackHatCoiner]

They are already jumping ship and replacing ASIC's with HPC's as AI learning gives them more stable income.

They're "replacing ASICs"? What does this mean? Selling ASICs for HPCs? Even if some miners migrate elsewhere, this means difficulty declines, and makes the rest take their piece of the pie.

Meanwhile, hashrate is pretty much at an all-time-high: https://www.coinwarz.com/mining/bitcoin/hashrate-chart.

Two more halvings and you can say goodbye to Bitcoin.

Oh, is it two halvings now? So, in 2032, there should be the last headline in here? I can't keep up with "Bitcoin is dead" anymore. 

[MeGold666]

Meanwhile, hashrate is pretty much at an all-time-high: https://www.coinwarz.com/mining/bitcoin/hashrate-chart.

Zoom out... and btw, more hashrate does not mean more miners, it's getting more centralized each year.

Oh, is it two halvings now? So, in 2032, there should be the last headline in here? I can't keep up with "Bitcoin is dead" anymore.  

As a means of payment it's been dead for a long time now.

The fact that you can't deal with reality is really sad, "all time high" and linking to charts that say otherwise...

I'm out of this forum as I don't need to talk with toxic people in my life.

Cheers!