Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
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Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
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Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#2What happened in 2017? What's happening now? Is it related to miners being shutdown in China?
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#3Failing as planned.
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#4That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2].
edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the average transaction value [4], which to me says that it's becoming the settlement layer as expected.
1: https://statoshi.info/d/000000017/fee-estimates?orgId=1&from...
2: https://www.coindesk.com/okex-exchange-to-integrate-bitcoins...
3: https://www.bitcoinfees.info/
4: https://bitinfocharts.com/comparison/transactionvalue-btc-xr...
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#5This is the consequence of the sudden loss of mining power. The increased usage of Bitcoin transactions while the blockchain is now processing fewer transactions means the fees increase, because users are willing to pay that much to transact faster.
Ideally market powers would offset this by people with spare CPU time beginning to mine to pick up the slack, since profitability is up. However due to the development of specialized mining hardware, mining isn't elastic anymore and so it doesn't happen.
Because of that the fees will not decrease until the next difficulty adjustment which is every two weeks, or until the miners come back online.
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#6That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2]. edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the avera…
> which to me says that it's becoming the settlement layer as expected
To me it says that only rich whales get to transact in bitcoin.
Pretty sad that now regular people get excluded from something that was conceived as p2p internet cash.
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#7This is the consequence of the sudden loss of mining power. The increased usage of Bitcoin transactions while the blockchain is now processing fewer transactions means the fees increase, because users are willing to pay that much to transact faster. Ideally market powers would offset this by people with spare CPU time beginning to mine to pick up the slack, since profitability is up. However due to the development of…
Here's a gap in my understanding: why does bitcoin mining explode so much when the price goes up? With all the new miners, doesn't the difficulty adjustment kick in after two weeks and largely negate the price increase? Or does the difficulty scaling not quite work like that?
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#8That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2]. edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the avera…
I'm a long-time bitcoin skeptic, and I don't really understand the lightning network. If the lightning network doesn't depend on PoW for every transaction then how is it different than a normal database-backed payment network? I read that it involves smart contracts, have those been sufficiently audited against bugs?
> That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3].
This is meaningless to me. Why would I care about transaction costs in satoshis per byte? I thought bitcoin is supposed to be a currency that replaces USD. At the current transaction fees bitcoin is not usable as a currency unless you're buying very expensive items.
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#9That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2]. edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the avera…
> which to me says that it's becoming the settlement layer as expected To me it says that only rich whales get to transact in bitcoin. Pretty sad that now regular people get excluded from something that was conceived as p2p internet cash.
Not really, it just means big centralized companies are settling their end-users funds on the blockchain while providing them access to it practically free. Regular people right now use it through Paypal, Cash app, Venmo, Coinbase, etc.
And soon enough channel factories should make it possible to create multiple lightning channels at once, so an end-user will never pay the whole channel opening fee by themselves.
As long as Bitcoin's layer 1 stays secure/open/decentralized, the average non-whale user will be able to use it through these other layers just as easily.
Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017
#10That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2]. edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the avera…
> which to me says that it's becoming the settlement layer as expected To me it says that only rich whales get to transact in bitcoin. Pretty sad that now regular people get excluded from something that was conceived as p2p internet cash.
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