Topic: Bitcoin Future Transaction Prices (Read 524 times)

It's not just removing the cap, this method has it's own protection mechanisms.

Can we stop pretending that this solution do not already exist ? It's working perfectly fine against spam on a live project.


Yes that's true, but only if we close our eyes to the successful project that already uses dynamic block size and has greater security than Bitcoin.

We can put our heads in the sand but the problem will not disappear.

Page 62 describes the mechanism:
https://www.getmonero.org/library/Zero-to-Monero-2-0-0.pdf

BTW. The article you have linked to was just an advertisement for "CertiK Foundation" that's already gone (their main site is dead), seems they have switched to auditing on their new site.

The challenging math is finding a balance among three components in Blockchain Trilemma: Security, Scalability and Decentralization. It's very difficult math issue to solve as one component interacts with and impact on two other components as well.

The Blockchain Trilemma: Decentralized, Scalable, and Secure?

It is difficult to figure out solutions to satisfy everyone from Security, Scalability and Decentralization but if people are looking for a blockchain with best security, it's Bitcoin blockchain.

Otherwise, if they are looking for blockchains with faster transaction confirmation time, cheaper transaction fee, they can find it with altcoin blockchains but by such choices, they sacrifice security.

We can manage to find an actual solution but removing the block size cap (that is what dynamic block is) is not a solution, it is a disaster that would destroy bitcoin because it has no spam prevention mechanism in it and without a cap (that would create a fee market and make spam attacks financially infeasible) they would be able to attack bitcoin very easily and with very low cost.
And that's just one of the problems.

Let's stop pretending there is no solution, the solution has been there for years but "Bitcoin" refuses to update.

It's called dynamic block size (aka adaptive/variable block size) that changes according to network transaction traffic.

Calling it "Digital Gold" only reinforces that Bitcoin does not need any updates and normal people who are not big investors feel it the most.
Comparing Bitcoin to a dead stone is not good, it's a living thing that needs updates.

LN is not a solution, it failed on so many levels... and even one of the devs resigned because current exploitable behavior can't be fixed without updating Bitcoin protocol.
And on top of that LN is getting more and more centralized because that's it's nature.

If LN is solution to Bitcoin scalability, then so is PayPal.

The line of "defense" against updating is usually to keep the hardware requirements low.... so useless old junk can run it too and do nothing while being online.
Guess what... majority of people have kids and kids have gaming computers that need to be upgraded every few years in order to play games and fiber optics are becoming standard in every home.

I guess quantity over quality matters more when it comes to nodes, even if they contribute absolutely nothing to the network security.

So let me get this straight... we don't update Bitcoin protocol to keep the old hardware online so we are more decentralized (at least on paper) while at the same time we are sacrificing scalability and forcing people to use solutions that are becoming more and more centralized... Interesting. (Monty Python's Flying Circus intro song playing in the background)

Few months ago when SEC approved ETFs and make Bitcoin soared to $73K, the Bitcoin fees is cheap, it likes their investment didn't affect to transactions fees. However, they really not give any impact to the mempool because any Bitcoin ETFs is off-chain, means the exchange don't need to move the coins.

The fees shouldn't be a problem for small investors, since they can purchase Bitcoin in lightning network.

I'm not sure that Bitcoin is going to be truly "globally accepted". And by "globally accepted" I mean Bitcoin becoming a truly mainstream global currency. This most likely would never happen. Bitcoin would be more like "digital gold", a financial asset that is mostly used by the big institutional investors to add in their portfolios. The problem is that those big institutional investors could afford to pay ridiculous transactions fees. This could scare away the small BTC investors. I don't know about any potential solutions of this problem, since I'm not a Bitcoin Core developer.

many people did talk about the financial cost of mining bitcoin/bitcoin economics. even hal mentioned it(2010).
he talked about how the fiat market price is deflationary and will cover the costs.. it should never be about paying more sats per tx. it would be about the fiat market increasing so each sat is worth more..

also those idiots(windfury admires) want bitcoin to reduce in demand so that they can promote another network people should use instead.
those idiots are not bitcoiners and dont care about bitcoin and its funny when i see windfury admire people that promote that people should stop using bitcoin and people should pay more sats on bitcoin.. it just shows windfury is not a bitcoiner either

I think this is a very normal thing that happens in Bitcoin transactions because the price is already as high as it is now and it is quite balanced with the costs that must be incurred every time you make a transaction. Personally, I am also very aware of this, but I have never complained about the costs that I have to bear when I want to make a transaction because it is sufficient for the amount of value we are transacting. So enjoy the balance and continue to like Bitcoin like you like a very valuable asset and don't because of this our trust in Bitcoin could fade.

All I can say is that better wait until the time it was widely accepted, we all know the fees. But for now, let us just accept the fees are moving high as it is impossible to see it returning back below $1.

We just think that the price of bitcoin increases, the same thing happens with the transaction fee. Therefore, our expectation it will be higher than these days. That is why I feel bad when seeing the fees in the past weeks reach more than $20 because it has a huge impact on the adoption process as it surely increases uncertainties believing that it is not the preferred fee we've looking at. For big investors is not a problem but I was very concerned about small investors that will take the burden of paying high while earning less.

I also thought so, in the future the transaction fee of Bitcoin is going to be more expensive than the transaction fee of this year. It is difficult for me to know how high the fee can go but I believe that as the price of Bitcoin continues to grow higher after every 4 year, that's also how the fee will be increasing, the reason why I think so is because of how the transaction fee was extremely low when 1 bitcoin was just $8.

There was when I was so worried about the future bitcoin price and that made me to tend to exchanges then. But I came to the understanding and realization that bitcoin price will always high at a point but will definitely return to normal after some time. Besides, even in the future if the price to withdraw your bitcoin from your wallet is very high, there must also be solutions then.

I should think more on how to earn bitcoin and secure it and not how to be unable to withdraw my bitcoin when I need it. The mempool cannot be consistently filled and the transaction prices keep hicking. Let's have the mentality of 'when we get to the bridge, we cross it'.

Understand basics about Bitcoin blockchain, mempools and how transaction fee is calculated and paid, will help Bitcoin users to be more cleverly with their transactions and save more transaction fees.

The protocol is the same for everyone but we can be different on our own ways to use the blockchain, when broadcasting transactions from our non custodial wallets with which we have rights to set up fee rate but if we don't know how to set it up properly, we will have to pay expensive transaction fee as same as making withdrawals from centralized exchanges.

It will drop but from 1000 or 100 sats/vbyte, fee rates in the mempools will not fall to 8 sats/vbyte in next minutes.

I don't think you should worry about this much. More than a decade has passed since Bitcoin's inception; adoption has accelerated a lot, the price has skyrocketed, even global financial giants have joined the game, but we could still enjoy as low as 4 Sats/vB every once in a while.

If more adoption would mean unaffordable transactions, there will always be responding technologies that address it. A rising problem would always be followed with a solution.

But I believe transaction fees would remain as volatile as Bitcoin's price. It might be like this for the next few decades. From 4 Sats/vB, it could suddenly jump to 100 or even 1,000 but from there it could also fall to 8 the next minute.

Bitcoin is definitely the most secure and safest crypto currency out there that most people would rather pay for high transaction fees in order to make transactions than use other projects. Unfortunately not everyone has this choice. If they do not have enough funds, they can forget about their transaction going through for a while.

Despite this being a huge problem, I don’t think adoption will stop just because of this. But still it will be nicer to not have a huge chunk of your coins stripped away.

I think transaction prices are visible already, so it's not hard to calculate them anymore. The ones that are hard are what the OP wants which are the future transaction prices because we don't know the numbers yet. When it comes to mass adoption of Bitcoin, we may not exactly know the future value's but we are sure that it is going to be huge. There will be no more banning of it in the future and those who ban it before are now going to allow it.

The only thing is, it might also make the transaction fees bloated but I'm sure that experts will find a solution to it again, just like what they did in the past, so let's not worry about it shall we?

Most of us are facing this problem but unfortunately there isn't any fix and it's like we have to accept the reality and either pay the transaction fee else keep BTC in wallet itself which would be very and no one would suggest that.

Now let me come to second point, no matter how many times we discussed this but we don't have a solve hence this will be discussed until we have a fix for this so I would request those so called expert not to respond if they don't have a solve instead of saying this has already been discussed numerous times.

The more people keep adapting Bitcoin there will be more solution from miners to make more rooms for the blockspace. Th truth is that there will be more work for miners since they will be making lots money so many individuals would venture into mining and that would make it a  lot easier for the blockchain. I still believe everything would move smoothly its just a matter of time they will find a solution if there is a mass adaption compared to now.


When such a time come, yes, the fees would be high at some point and transactions would take longer to complete. It has happened before but in the case of so may people entering into the system it would give a chance for miners to as well to join the system. So with time there will be balance.

I wouldn't worry much about Bitcoin transaction fees  because it has never been the case that the spike in tx costs stay permanent for a longer time. The recent spikes we had were due to BRC20 spams but when all of that is taken away, the network should be able to withstand the pressure. But it's worth noting that the average user especially those in rural communities will have a hard time making plenty transactions if tx cost is closer to $1 or more if they can complete a similar transaction in fiat for less than $0.1 in fees.

Your fears are based on your presumptions that "if X happens", then Y will absolutely happen". No one can actually say that if Bitcoin's block size was increased - "this will happen", or that if the block size was maintained - "that will happen". There's the economic side of things when we use the Bitcoin network. In your fears you said that banks would price us plebs out, BUT it's a complicated situation. Will they actually do it?

Plus from the network's viewpoint, higher fees = more security = more value for the network.

Bitcoin transactions comes with seasonal increase in fees and this is absolutely not helping. There are overhyped projects in the space but we should be extremely careful not to fall in the hands of scammers because they're definitely not going to pity us, rather they will hacked into our port folio without our conscience. Bitcoin is top project in the market, and it will continue to make increase because we're in the bull season already and we've watched ourselves hitting the top with gigantic profits.

Bitcoin transactions are perhaps getting higher with each spike. It can be seen by using monitoring websites with long-term charts of average transaction fees. However, the spikes aren't that common, and the fees remain acceptable once the spike is over. So I think that in case of urgent selling, a fee can become a larger and larger issue, but if it's nothing urgent, then I expect the fees to regularly be within reasonable limits (below $10) even as adoption gradually increases. Unless there are more overhyped projects or some country suddenly deciding to frequently use on-chain transactions, it shouldn't be an issue.

Expect the fees to raise along with the price and remain proportional.

Is that honestly a bad thing for a hodler like you? Let's say you have $1000 in bitcoin and the transaction costs you $10. Moving that money when your bitcoin is eventually worth $2k and the tx is $15 or $20 shouldn't be a problem, am I right?
 
This is how it's going to look for a small investor, but some of us already have 1m+ in bitcoin. If the price goes up by 50% but the fee does the same, I probably won't even notice.

You would not have to worry about the future high cost of bitcoin transactions fees, because if this digital asset reaches such heights of value that even these commissions become prohibitively expensive, then you will find yourself (if just hodl) in such a good profit that these commissions will be for you completely insignificant.

Don't be too greedy.

In order to save money (for transactions fees), refrain from using old format bitcoin addresses (legacy) and give preference, for example, SegWit.

By the time the BTC-price increases significantly, a new update may be released that will reduce high commissions. So, this problem may disappear by itself.

OP you can use the search feature to check the previous topics on the same subject, At the same time I don't think we need to start an entire discussion thread again, in my view if you think the Bitcoin network is costly you can move on to the L2's and other solutions. It's not the case with the entire year, in just peak times the Bitcoin network transaction fees go high, in the entire year if you check fees are not that high even though sometimes people take advantage of lower transaction fees just like a few days back, comparing to the yearly start.

You can't enjoy 2 Buses in 1 ticket so you need to sacrifice in order to enjoy.

Honestly we do need to figure out to make it cheaper for sure, it doesn't feel like that at all times but that doesn't mean that we are going to end up with a good result that easily. We should probably do something about the block, we did move to segwit just because the legacy one wasn't all that great which is understandable and nothing wrong with that, but also we need to remember that we are not going to get anything profitable out of this if we are not careful.

If we end up doing something quick without checking it first, then we are going to have a cheap and fast blockchain that could get hacked into. This is why things are slow in the crypto world, security takes time, and you double check everything constantly even a line of code.

All the above, I like to speculate from the price point view; I mean how higher bitcoin prices would be impacting the transactions fees. Yes, when bitcoin will be valuing very higher like one million or ten million per bitcoin then we can say 1 satoshi or 100 satoshi will be enough for one transaction as a fee because 1 satoshi may value $10 or $100. In another perspective, when bitcoin will be valuing too higher then people may not spend much or like people will not spend bitcoin for daily needs which means bitcoin will turn as "pure asset". So, lesser transactions and blocks will not be 100% which will lead to lower transaction fees.

No, there's no documentation about it because that variable is dynamic. There are days that the transaction fees are so low, or at least during the bear market, we can transaction with 1 sat/vB. Until such time that there are grows of people who clogged the mempool, thus pushing the fees very high and there are people who says that Bitcoin is no good for p2p transactions.


it could be, or it may not, even if adoption grows, maybe we can see the transaction fees not going up. Cold wallet and layer 2 are two different things. Cold wallet refers to the wallet itself, while layer 2 is LN. You may want to read it here, [General] Bitcoin Wallets - Which, what, why?

If you're that worried about transaction fees, you'd probably be better off storing your bitcoins in a wallet that's following the transaction fees in the mempool, don't give in to the allure of putting your bitcoin in wallets like Trust Wallet, you don't have any benefits in storing your bitcoins there. We can't really do much as hodlers when it comes to the increases in transaction fees but you've got to understand that it's natural and it's not in favor of miners that they're not getting a lot in transaction fees, they're a part of the bitcoin ecosystem too and with bitcoin getting more scarce, it's probably for the best that the fees are increasing seasonally to make bitcoin mining still worthy investment.

This is my first time hearing about Fedimint, I searched about it and came to know that it should not be called a layer 2 solution as it is not built on the main layer of BTC. It doesn't work like other L2 solutions work but we might use it along the lightning network for security and privacy and if used with LN then we might make a cheaper transaction as well. Overall, it's also a good thing, Recently I came to know about L-BTC and now this Fedimint. I am learning day by day haha.

Speaking of the tx fee, I would say defimint is not going to help us in fee thing as it can't solve the scalability issues, only L2 networks could but to setup LN for the first time we have to pay the normal fee, besides not so many cexs supports L2, so if you are dealing directly with CEXs you first have to confirm either the exchange allowed L2 networks. Prices will increase due to high volume or transactions, but it not only depends on this factor but to understand them you first have to know How Bitcoin Fees Work

I believe that Layers on top of the Blockchain will still probably be the solution.  A solution will be necessary anyway, because otherwise the more people are using Bitcoin, the higher the chances the Mempool gets clogged up particularly with spam from B S like Ordinals.

There are already a few methods you can help too.  Spend in as fewer Transactions as possible, use SegWit, use Lightning when ever possible.  Lightning already provides an instant solution to the problem.  I suppose the more the Mempool will be congested, the more a solution will be pushed out as necessary.  As long as the issues are only temporary however like always, I doubt a big change will be made.

Bitcoin’s transaction fees depend on its price and mempool. The more people trying to make a transaction, the more congested the mempool is. So in a future where we are assuming that bitcoin has become more popular than it is now, we can expect that its price will also spike.

In relation to its price, more people would be hoping to make a transaction. But for sure due to the congested mempool that was caused by the mass adoption of bitcoin, the transaction fees are set to be high. If you don’t want to pay higher amounts, then there’s no way your transaction will go through.

Seems pretty disappointing right? Well more people will think the same and start looking for other alternatives besides bitcoin. This may be the cause of bitcoin’s decline. If not solved now , this scalability issue might pose a serious threat to bitcoin’s demand.

Per transactions will get paid in satoshis per byte/vByte and that means that the conversion will really depend on how much is the price of Bitcoin by the time you'll transact in the future.

Oh, I miss the time when most of the transactions were certainly cheap and nearly free or it was free for some instance at all.

But that was a long time and I wonder how it is really going to like in the future when price of Bitcoin surges more than what we're expecting. So, it's going to make everyone just hold it rather than spend it.

Depends on the size of the transactions, the mempool and Bitcoin price.

Let's say you use native segwit address, the mempool is really congested and Bitcoin price already around $100K.

The size of a transaction with 1 input and 2 outputs is 130-140.5 vbytes, you paid for 1,600 sat/vbytes, so it would be 208,000-224,800 satoshis. If Bitcoin price is $100K, it means you need to pay $208-$224.8 just for the fees.

This scenario we're discussing will only possibly play out many years, decades possibly, down the road, so I'll rule out the option of leaving your bitcoins in a custodian exchange. It's much better to have some coins and then the problem of how to move them around than to not have any coins cause a certain exchange was hacked and have filed for bankruptcy.

If you've ruled out the option of exchanges then storing on cold storage seems like the most obvious choice. It prioritizes security and if you consolidate while moving there it reduces the fees you'll need to pay when you eventually need to move it around.

No one can exactly determine how transaction fees will evolve, we have educated guesses but they are still speculations.

I believe we've passed that point a long time ago. When I started with Bitcoin (9 years ago), I could make cheap transactions to get a feel of how it works. Now, I can't recommend anyone to store a small amount of Bitcoin in their wallet.

@OP: nobody can predict transaction fees in the far future, but you can consolidate your inputs so you don't have many small inputs in the future. Having less inputs, and thus a smaller transaction (in bytes), will sharply reduce transaction fees if fees get much higher.

There are many discussions about it but I don't think it is a predictable thing and everyone is analyzing it from their own point of view and we have not been able to agree on certain fundamental things yet.
For example the on-chain scaling versus second-layer scaling is still a hot topic and as long as we can't agree on these things and start moving forward, we will be stuck.

It is a bit more complicated that that.
I believe higher fees would slow down adoption which means less people would use bitcoin which means both price and fees won't go up after a certain level and bitcoin will start struggling to get adopted more. Unless we come up with some scaling solution and fix exploits such as the one used by the Ordinals Attack these days.
So I don't think we ever get to the point where bitcoin is too expensive to use.

Transaction fee, not transaction price. Bitcoin is not Ethereum, no gas price with Bitcoin transactions.

Real demands are different than waves of spams because people don't understand Bitcoin mempools, transaction fee setup and ignore all risk to chase with projects that potentially can help them get rich quick or lose money quick. It's also different than attacks from people who dislike Bitcoin or just do massive mint NFT BRC20 tokens and cause mempool congestions.

Watch mempools or use this Telegram bot.

[Telegram Bot] Bitcoin Fees - fees and tx tracker
@BitcoinFeesAlert_bot

As far as I know there’s no research or data that has been analyzed to come up with an accurate estimation of transaction prices. With bitcoin’s price being volatile, the same goes for transaction prices. We can’t determine just how huge can the mass acceptance be and how much it can impact transaction fees. I am hoping that by then it could have been resolved by a much more efficient technology.

Or, more "adoption" simply refers to more off-chain Bitcoin or derivatives? I mean, even in 2017 I met people who told me they finally bought Bitcoin. It was in 2021 when my kid's friends said the same thing. Former was suit and tie, latter was Gen Z -- neither actually held any coin. Just an app or broker that told them they had Bitcoin. So did any of these guys interact with blockchain? Nope.

That's a shitty simplification but it makes sense to me to explain why in spite of breakneck "adoption" it still takes shitmemetokens called BRC20s to flood the Bitcoin network.

This is my concern about a cold wallet. What is the end goal of Bitcoin? Global reserve currency (digital gold), or peer to peer cash? I am not sure both can be attainable in its current design ( am also a noob and just trying to understand more). If it is a cash system like it has existed in the early days, cold wallets for personal use makes sense. But if Bitcoin continues to grow it and is adopted by more, it may become a global reserve currency due to its finite supply. Under this global reserve currency assumption, bitcoin would be backing every bank, who would be throwing around huge transactions and willing to pay large transaction fees. This would crowd out individuals who want to use cold wallets other than those who hold a large sum of bitcoin, as they would have to pay bank level fees to move around Bitcoin which for most would not be economically feasible. In this scenario, the blockchain would become the source of truth of transactions, lightning would be used by banks for settlements, and you would need a secondary currency backed by bitcoin (US dollar, mint, other crypto, third layer solution, etc.) and make personal cold storage options (for Bitcoin specifically) unfeasible for most.

 Am I missing a key component of this train of thought? In this scenario, custodians become almost necessary due to the amount of transactions needed if everyone used their own personal cold wallet. Is this the natural progression of Bitcoin, or are there developmental efforts to make cold wallets feasible for all in the future as the adoption of Bitcoin continues?

None. I believe during the very early days of Bitcoin, no one wanted to talk that this might be a problem.


I believe that it will be the same as the current situation. You worry about constant demand, but economically, how could that be if fees are very high? The users who can't afford it won't make an on-chain transaction, the users who can would slowly lose coins until they can't.

If the price of a good or a service is too high, then naturally the demand for that good or service will go down.

Good decision because with this, you can be able to know the amount of fee rate you're going to be charged before making your transaction, but not only that, you could be able to customize that fee to your taste.


There is nothing like transaction prices, what we have is transaction fee.


Its simple to know and understand, if the network gets busy, then there is more transactions ongoing and the mempool will be more congested causing increase in the transaction fee, in such a way that, anyone who can pay higher will get his transaction confirmed faster, which is normal on many settings as per competition, if there are no more clogging and pending transactions as before, then the network get less busy and no much congestion and we pay lesser fee, as regarding the block space, that is what we have for now, we cant predict the future if there could be addition or subtraction on that.

It is quite difficult to estimate a number, considering the fact that many transactions would be made on 2nd and 3rd layers by then (hopefully). In any case, my bet is that maybe in a few years a transaction on bitcoin could be within the range of hundreds (or maybe a thousand) dollars. In such case, it might be worth it to consolidate your coins on the main chain only once a year or so, for example.

We already had this discussion many times whenever the network fee surged to unexpected level but increasing the blockspace will interfere with the authenticity of bitcoin nor incentivise the miners in the way they deserved.

Websites like https://mempool.space/ and https://jochen-hoenicke.de/queue/#BTC,2h,weight will help you with the historical transaction prices of Bitcoin.But you can't predict what will happen in the future but assuming bitcoin network will not be spammed like brc20 again it will be economical as it used to be.


Cold wallet is supposed to be where your funds stored for long term so that you may not make more transactions from from that wallet like hot wallets. L2 layer is providing the opportunity to move funds as less as possible with bitcoin but not yet widely adopted. Custodial services are working for profits so they will take advantage of making money whenever it is possible so better not trust custodial wallets even if the offers you to move bitcoin at cheaper cost.

I am working to get my bitcoin off of exchanges and into cold storage but I had a question regarding transaction prices. As more adopt Bitcoin, transaction prices are going to increase as there is more demand for blockspace. Is there any documentation or research into what transaction fees may look like in a world where Bitcoin is more widely accepted? I am worried that from an individual level the blockspace may become so valuable that moving Bitcoin on and off a personal cold wallet may be unfeasibly costly for the average user.

My understanding is at the current moment while it is still becoming adopted, the value of the Bitcoin held should scale with the transaction costs. I am more wondering about long term viability of personal cold wallets, and how the different layer 2+ scaling projects (lightning, Fedimint, etc.) as well as custodial services may play into the long-run transaction costs. Anyone with knowledge or resources they could point me to would be greatly appreciated!