Topic: Bitcoin transaction fees??? (Read 1487 times)

That's a good question. I haven't been paying attention to transaaction fees between exchanges but I probably should.

Clearly not.  Maybe they will in the future.  Maybe they won't.


Nah. Nothing like that.  Nobody is going to incarcerate or shoot you for failing to follow the bitcoin "rules".  They'll just ignore you.  If you (and others with your complaints) can convince enough peers to run a client that will relay micro-transactions without a fee and can convince enough miners to include them in blocks, then micro-transactions will be feasible.  It's decentralized like that.  Everything that bitcoin is and does was created by people just like yourself who wanted it to work a certain way and got involved.


No. I've explained it all quite a few times.


Well, they'd refuse to use the pool, and they'd switch to a pool that did tell you about the fees I suppose.  On the other hand if their fees were lower than the other pools, people might still continue to use them.  There'd probably be quite a few people who blindly choose to use the pool without knowing that the pool was charging fees and without caring.  Some people might be "up in arms" but it isn't like they could do much more than switch pools.


Bitcoin-Qt is the "reference" client.  There is no such thing as an "official" client.  Many, many, people use other wallets.  Bitcoin-Qt is offered free of charge, and is maintained by a group of volunteers (although they have received significant donations in thanks for their efforts).


Me? I'd make sure I understood what I was choosing before I chose a pool.  If I later discovered that I was lacking in my research, I'd switch pools and make sure everyone that I talked to knew that the pool had fees that they don't publicize. Sort of like how I'm making sure that people know that the Bitcoin network has fees that aren't always publicized. See how that works?


If the information was available and I hadn't done the research to find out, I'd thank them for letting me know and adjust my decision based on the new knowledge.  Then I'd help others learn about it as well.  If the information wasn't available and was actively hidden, then I'd refuse to use the pool any longer and do what I could to let others know about it.


If you agree to something without understanding what you are agreeing to, that is nobody's fault but your own.  You need to take some personal responsibility for the decisions you make.


Sure, right up until they also are worth 1000 pounds.  There is no guarantee that the litecoin exchange rate will remain less than the bitcoin exchange rate.  Either one could become more popular than the other and that popularity could drive up the exchange rate.  On the other hand, either one (or both) could completely fail and vanish from use.


I don't know who "they" are, but I'd be careful about accepting that definition.


The wallet does tell you that it is charging you money.  It doesn't include the fee without first telling you that it will.


I'm not sure what "beloved" your are talking about.  Regardless, a ticket would be a fee you'd have already incurred and couldn't get out of.  This would be more like parking your car in a lot you thought was free.  As you go to get out of your car, an employee points to the "PARKING 10 pounds" sign you didn't notice and says "you're going to either have to pay to park here or you're going to have to find somewhere else to put your car".


Nope.  As I've already explained:



Same effort.  As in, I didn't make an effort to be snarky in the first post, I didn't make an effort to avoid snarkyness in the second post.  Somehow, you find one snarky and the other not.  Nothing I can do about that.


The difference is that you are paying a fee to the pool operator to use their pool.  They have a financial incentive to satisfy you so that they don't lose your business to some other pool.  The pool is owned and run by them, and they are the only ones who can change their operations.  You are welcome to create your own pool, or switch to another pool. I'm not sure what you mean by "no such suggestions for the bitcoin qt wallet".  I'm pretty sure that I've already given similar suggestions for Bitcoin-Qt.  Did I not suggest creating your own, or refusing to use it, or switching to another wallet?  You are welcome to refuse to pay them for their client if you don't like it.


You're welcome.  Have a great evening.

"Open source, volunteers designing and programming, an expectation that the user will take personal responsibility for knowing what it is that they are using.  Pick your reason."

So they go to all the trouble to make the client but cant add a simple message upon installing that explains their are fees involved under certain conditions? lol...

Oh and you think the people did it for nothing? Sure they did...

"As has already been explained, the peers are voluntarily enforcing their own relay rules on which transactions they will relay.  The miners (or pools) are voluntarily enforcing their own confirmation rules on the transactions they confirm into blocks."

What, like the way that the government voluntarily makes laws that all of us must follow? Oh but we could move country right? Straight into another country that voluntarily makes laws we must follow... And like governments they are not even clear about what the laws are! lol

Hmmmmm

Not very voluntary for the end user though is it, well like I said I suppose they are free to not use it! Much like we are free to not use banks!

Doesn't seem very free though, and like I said a simple message would solve all the confusion, and I am not the only one that has run into this issue, am i?

When you join a pool do they not tell you about their fees? Pretty sure they all do... Because if they didn't people would be up in arms, right?

Bitcoin qt is sold like the "official" bitcoin client yet in reality it is pretty shady and not very upfront...

Be honest, if a pool didn't tell you about the fees then you got stung wouldn't you be a little pissed with the pool? Then imagine asking about it and people telling you that you should just know it and it is your fault... You are like one of the people that says "should of read the small print" Knowing full well that no-one reads all the small print and most wouldn't understand it if they did... But hey whatever...

"I don't know much about Litecoin. I suspect that if they gain any sort of popularity, they will run into similar issues with denial of service attacks and need to implement some sort of defense."

But it is irrelevant whether they do or do not... Lets say bitcoin is worth 1000 pounds... You won't be able to make a 10 pound payment without incurring fees, so in steps litecoin which is worth 100 pounds (for instance) so you could make that 10 pound payment... They too could have the 0.01 minimum, you see?

They are saying (you know, they lol) that bitcoin is the gold, litecoin is the silver and namecoin is the bronze... Which makes sense and would solve the micro transaction issues...

"Well, that's sort of how the free market works. An entrepreneur sees an opportunity to provide a service or product that others desire, and they find a profitable way to meet that need.
"

I'm aware of how the free market works, I was having a little fun, but hey you carry on showing me how to suck those eggs...

"To a certain extent, it is the same thing.  Making a choice without understanding what you are choosing doesn't mean you aren't making a choice."

So you think it is unreasonable to expect people who charge you money to tell you that they will do so? Imagine you park somewhere in your car and there are no signs and then you get slapped with a ticket... Then you complain and some guy tells you that you made the choice to park there yada yada... That wouldn't fly mate and it doesn't here either! I know you will defend your beloved but I'm sorry, if you are to charge money you have a moral responsibility to explain that fully... Not mentioning it is as good as lying...

"You never said anything about what you do for a living."

But yet you felt the need to speculate and tell me I should program something more to my taste while knowing nothing about me or my abilities... Again, whatever...

"Regardless, the point wasn't to tell you to go create your own wallet, the point was to make it clear that there is no "Bitcoin Law" or organization that can keep someone from creating a wallet that implements different rules than the one you're using.  You made comments about how you "thought bitcoin was decentralized".  I was simply pointing out it's decentralized nature."

Yes, in a very snarky way...

"And yet the same effort on my part.  Odd how one message came across as snarky and the other didnt'."

Eh? What does your effort have to do with your snarkyness? If you can read those 2 messages and see no difference then I can not help you to understand... They are clear as day chalk and cheese, but oh well... But yeah, same effort so well done and a pat on the back...

"Yep.  Perhaps a complaint to the pool operator is in order.  As well as a refusal to use their pool again until they correct the oversight?"

But no such suggestions for the bitcoin qt wallet? Hmmmm do you have some connection to the guys that wrote the programe perhaps? Hmmmmm



I think we'll leave it there (well I will anyway)... I'm tired and very bored with arguing about trivial BS now, thanks again and goodnight...

Yep. But that's ok.


Open source, volunteers designing and programming, an expectation that the user will take personal responsibility for knowing what it is that they are using.  Pick your reason.


As has already been explained, the peers are voluntarily enforcing their own relay rules on which transactions they will relay.  The miners (or pools) are voluntarily enforcing their own confirmation rules on the transactions they confirm into blocks.


I don't know much about Litecoin. I suspect that if they gain any sort of popularity, they will run into similar issues with denial of service attacks and need to implement some sort of defense.


As I said before:


and



Well, that's sort of how the free market works. An entrepreneur sees an opportunity to provide a service or product that others desire, and they find a profitable way to meet that need.


To a certain extent, it is the same thing.  Making a choice without understanding what you are choosing doesn't mean you aren't making a choice.


You never said anything about what you do for a living.  For all I know you may be a very skilled computer programmer.  You also may be quite wealthy and willing to pay a skilled programmer to create a wallet to your personal specifications.  Regardless, the point wasn't to tell you to go create your own wallet, the point was to make it clear that there is no "Bitcoin Law" or organization that can keep someone from creating a wallet that implements different rules than the one you're using.  You made comments about how you "thought bitcoin was decentralized".  I was simply pointing out it's decentralized nature.


And yet the same effort on my part.  Odd how one message came across as snarky and the other didnt'.


Yep.  Perhaps a complaint to the pool operator is in order.  As well as a refusal to use their pool again until they correct the oversight?


No problem.

I'm assuming that you are running the Bitcoin-Qt wallet?

If you are running version 0.7.1 or later you should have access to a "Console" window in the "Debug Window" found under the "Help" menu.

If you're curious about exactly how many outputs are in your wallet and what the value is of each of them, you can run the following in that console window:


Each unspent output will have the following:

• "txid": A transactionID which you can look up at blockchain.info if you want to see the transaction that sent you that output
• "vout": An offset indicating which output from that transaction is the one being indicated (0 indicates first output, 1 indicates second, and so on)
• "scriptPubKey": A binary representation of the signature requirements that a wallet will have to supply to spend the output
• "amount": The BTC value that the output would contribute to a transaction if it was used as an input.
• "confirmations": The total number of confirmations the output has received so far.

"No need to be sorry, most people are unaware of this aspect of bitcoin.  The only way to know is to stumble across it or have it explained to you."

I don't know how to do the quotes on this site so I will do it the old fashioned way, lol

I'm sure you're aware I was being sarcastic lol... But yeah your message came off a little high and mighty although maybe you didn't mean to be so it's all good anyway.

Why isn't the wallet upfront about the fees? Why isn't it explained when you install? Even the robbing S.O.B in the corporate world give you some small print, lol.

 "As such, to protect the network, it was decided to enforce a transaction fee on relaying transactions if their value is less than 0.01 BTC or if they are really big (larger than 10 kilobytes)."

Enforce? I thought it was all voluntary? lol...

Though I understand your explanation and it seems kinda reasonable it also starts to sound all too familiar and centralized, though I know you could technically argue it isn't...

But still on the upside I guess that is where litecoin and namecoin steps in? To replace the micro transactions?

Oh and as I said before what will happen if bitcoin goes through the roof? And say 0.001 is worth 10 quid? You will only be able to use bitcoin for large purchases, not exactly ideal but I guess litecoin and namecoin will have to move it line to fill the gaps... Do you think that will happen?

 "Bitcoin is still in its infancy.  Over time as it matures (assuming it succeeds and makes it to mainstream use), additional services and technologies will be developed that will protect users from some of these issues."

You hope... lol

Nah I can see that and I know it is still a baby and all but yeah today that gave me quite the shock, especially because of the age of bitcoin, if you are getting fees like that now what will there be in 10 years time, came into my head...

"Snarky?  I've explained this to many people, many times.  You're the first person who has accused me of being "snarky" when I'm explaining how it works.  Ah well. I guess it doesn't matter.  The only point was to help you understand how it works, and why the fee is "required".  As long as you've learned that, I guess I don't really care if you think I was "snarky" or not."

Re-read your comment to me, you were teaching me to suck eggs a little while not exactly being fair... Things like the "you chose to use a wallet that charges a fee", when this is not true as I had no idea that even other wallets existed and I had no idea fees would be levied for any reason at all. So I didn't "choose" to have that, I just was not informed which isn't the same thing.

And like telling me I can write my own wallet and convince people to use it etc, I mean like come on! I'm asking newbie questions and you talk to me and writing a program, a bit snarky if you ask me.

And read your second message, much nicer with zero snarkiness lol...

I am 31 years old and after reading your first comment I felt about 10 lmao...

I still thanked you anyhow and I really do appreciate you taking the time to tell me how it works, just didn't appreciate the odd remark. No biggy...

"Possibly.  Possibly not.  Depending on how you do it, you're likely to run into a "pay now, or pay later" issue.  If you transfer all the bitcoins out of your wallet right now, your wallet will package all those bitcoins up in a single huge transaction.  Then you'll pay a "per kilobyte" fee just to send them all out of your wallet.  If you had just used them as needed, you may have still paid a "per kilobyte" fee on each transaction in the future, just spread out over more transactions.  It really depends on just how many tiny outputs you have and how small they are.

As a matter of fact (depending on how many of these tiny outputs you have), you're likely to find that it is very difficult right now to "transfer all of the bitcoins out of my wallet".  When you try, you'll find that the wallet will tell you a fee that is required, and that fee will cause the transaction to exceed your available balance.  Then you'll reduce the amount you're sending by the amount of the stated fee, and the wallet will quote a new different fee (since your transaction is no longer using every single output, the transaction size will change).  You'll play around with the numbers increasing and decreasing the transaction amount until you get to something close to your entire balance, but there may be a few nanobitcoins left behind.

You may not have that problem if you don't have many of those tiny outputs, but others have complained of such a problem."

I only have 174 transactions in total so it shouldn't be too bad though I think the problem could of been because I set the instant withdraw option on the pool too low, I had it at 0.001 I think so I guess each of those transactions incurred a fee too... Just a little message on the pool or the wallet would solve these issues though surely?

I'll have a go at getting the rest out and I will set all my auto withdrawals higher from now on.

"Unfortunately, most wallets don't provide the sort of "coin control" that you'd need to consolidate these small transactions.  It can be done with some wallet programs, but may require significant technical knowledge.

The concept is as follows:

"Priority" is determined by a combination of input value and input age.  Essentially it's calibrated so that with one "bitcoin day" you can send a transaction without a fee if that transaction is smaller than 10 kilobytes and has no outputs less than 0.01 BTC.  One "bitcoin day" means equivalent to one bitcoin aged one day.  This means that 2 bitcoins for a half day, or 4 bitcoins for a fourth of a day, or a third of a bitcoin for 3 days.  Multiply the number of bitcoins times the number of days and if the product is 1 or greater, then the priority is high enough.

This means you need at least 0.01 BTC in the wallet so that you can create a transaction with all outputs (in this case the only output) greater than 0.01 BTC.  However, if you only have 0.01 BTC, you'll need to wait 100 days between transactions to maintain a high enough "priority" to avoid any fees.

Lets say you send 2 BTC to your wallet in a single transaction.  Sending this 2 BTC anywhere will result in a transaction smaller than 300 bytes (leaving you about 9,700 bytes for other inputs to still avoid triggering the 10 kilobyte fee requirement).  2 BTC will be large enough to create at least one transaction per day without triggering the "priority" fee requirement.

Now all you need is a way to choose 9,000 or so bytes worth of tiny inputs with the 2 BTC in a transaction to another address you control.  Repeat this process until you've swept up all the "dust".  Like I said, most wallets don't give you the control you need to choose which outputs to spend, so this process requires some advanced knowledge."

Well you kinda lost me a little with the purity biz but I kinda get the jist...

I get what you mean about the 2btc analogy though and even if I had the knowhow I couldn't anyway as the coins are in a wallet that won't allow it so that's that. Anyway no big deal I'm just glad I caught it in time...

So just to clarify, if I make deposits of greater than 0.01 I should be okay? As long as I don't spend too many coins in one day?

Is there a way to check the kb's that you have used and have left etc? Wouldn't that be useful info to have?

"If you have the mining pool pay out to your wallet with every tiny bit you earn immediately as you earn it, then yes you'll probably have the same problem.  Most mining pools allow you to build up a balance with them over time, and then choose to have that balance sent to your wallet in larger chunks.  As long as you wait until you've built up a balance of 0.01 BTC before sending from the pool to your wallet, you'll probably be fine."

You were way ahead of me and answered me already lol...

Genuinely, thanks for the help and your time.

No need to be sorry, most people are unaware of this aspect of bitcoin.  The only way to know is to stumble across it or have it explained to you.


There is a known "denial of serivce" attack that could be perpetrated if these fees weren't in place.  A person could set up a few computers, and write a program that would send 0.00000001 BTC back and forth through multiple bitcoin addresses as fast as possible.  This would flood the peer-to-peer network with transactions that aren't acutally accomplishing anything.  If they generated the transactions fast enough, it would become almost impossible for anyone to get their transactions to a peer since all peers would be so busy verifying and relaying these "spammy" transactions.

As such, to protect the network, it was decided to enforce a transaction fee on relaying transactions if their value is less than 0.01 BTC or if they are really big (larger than 10 kilobytes).  Also a "priority" is calculated based on how long ago the output being spent was created.  The problem is that legitimate micro-transactions end up looking like potential spam.  Essentially a decision was made by those that release the generally accepted reference client that to protect bitcoin from a denial of service attack, bitcoin will not be economical for micro-transactions.


Bitcoin is still in its infancy.  Over time as it matures (assuming it succeeds and makes it to mainstream use), additional services and technologies will be developed that will protect users from some of these issues.


Snarky?  I've explained this to many people, many times.  You're the first person who has accused me of being "snarky" when I'm explaining how it works.  Ah well. I guess it doesn't matter.  The only point was to help you understand how it works, and why the fee is "required".  As long as you've learned that, I guess I don't really care if you think I was "snarky" or not.


Possibly.  Possibly not.  Depending on how you do it, you're likely to run into a "pay now, or pay later" issue.  If you transfer all the bitcoins out of your wallet right now, your wallet will package all those bitcoins up in a single huge transaction.  Then you'll pay a "per kilobyte" fee just to send them all out of your wallet.  If you had just used them as needed, you may have still paid a "per kilobyte" fee on each transaction in the future, just spread out over more transactions.  It really depends on just how many tiny outputs you have and how small they are.

As a matter of fact (depending on how many of these tiny outputs you have), you're likely to find that it is very difficult right now to "transfer all of the bitcoins out of my wallet".  When you try, you'll find that the wallet will tell you a fee that is required, and that fee will cause the transaction to exceed your available balance.  Then you'll reduce the amount you're sending by the amount of the stated fee, and the wallet will quote a new different fee (since your transaction is no longer using every single output, the transaction size will change).  You'll play around with the numbers increasing and decreasing the transaction amount until you get to something close to your entire balance, but there may be a few nanobitcoins left behind.

You may not have that problem if you don't have many of those tiny outputs, but others have complained of such a problem.



Unfortunately, most wallets don't provide the sort of "coin control" that you'd need to consolidate these small transactions.  It can be done with some wallet programs, but may require significant technical knowledge.

The concept is as follows:

"Priority" is determined by a combination of input value and input age.  Essentially it's calibrated so that with one "bitcoin day" you can send a transaction without a fee if that transaction is smaller than 10 kilobytes and has no outputs less than 0.01 BTC.  One "bitcoin day" means equivalent to one bitcoin aged one day.  This means that 2 bitcoins for a half day, or 4 bitcoins for a fourth of a day, or a third of a bitcoin for 3 days.  Multiply the number of bitcoins times the number of days and if the product is 1 or greater, then the priority is high enough.

This means you need at least 0.01 BTC in the wallet so that you can create a transaction with all outputs (in this case the only output) greater than 0.01 BTC.  However, if you only have 0.01 BTC, you'll need to wait 100 days between transactions to maintain a high enough "priority" to avoid any fees.

Lets say you send 2 BTC to your wallet in a single transaction.  Sending this 2 BTC anywhere will result in a transaction smaller than 300 bytes (leaving you about 9,700 bytes for other inputs to still avoid triggering the 10 kilobyte fee requirement).  2 BTC will be large enough to create at least one transaction per day without triggering the "priority" fee requirement.

Now all you need is a way to choose 9,000 or so bytes worth of tiny inputs with the 2 BTC in a transaction to another address you control.  Repeat this process until you've swept up all the "dust".  Like I said, most wallets don't give you the control you need to choose which outputs to spend, so this process requires some advanced knowledge.



If you have the mining pool pay out to your wallet with every tiny bit you earn immediately as you earn it, then yes you'll probably have the same problem.  Most mining pools allow you to build up a balance with them over time, and then choose to have that balance sent to your wallet in larger chunks.  As long as you wait until you've built up a balance of 0.01 BTC before sending from the pool to your wallet, you'll probably be fine.

One more thing, if I transfer all of the bitcoins out of my wallet will that get rid of these small transactions that are causing me the problem? You mentioned something about putting in a higher amount to solve it? Can you explain a little more about that?

And seriously how is all this going to translate to the average joe?

Oh and let me just add that I do love bitcoin and the whole idea of it, but there is certainly a lot to learn about it and I think that could really be a roadblock for it to gain wider acceptance....

Edit, another question RE the small transactions... Does the same apply if you are mining but only getting a tiny share? You know thus a tiny payout? Would that seem like spam too? Would there be a fee imposed?

Well I am awfully sorry for not instantly obtaining the knowledge that not all bitcoin wallets are equal. I mean why would I think otherwise? lol

I think this "spammy" thing is a bit silly as the sites I were using are doing legitimate business, they are just an advertising tool, which there is nothing wrong with right? And what if bitcoin price goes right through the roof? Won't most transactions appear "spammy"?

Bitcoin is a whole lot more complicated that I first thought, how do you think they will be seen by the average person? You know, the kind that doesn't know some wallets rip you off while others do not? Or the kind that doesn't know if they choose another type of wallet that doesn't rip you off but then you might not have your transaction completed at all!? All voluntary like... lol

I mean I guess banker fees are voluntary too, you could go top one bank that rips you off or you could go to another bank that rips you off or you could have no bank and live in the stone age! All voluntary though....

Sorry but this seems a bit silly to me....

All that being said I do thank you for your somewhat smarky answer to my question and I did learn a thing or two so thank you.

It is.  It's also voluntary.

You are not "required" to pay those fees.  You have voluntarily chosen to use a wallet program that imposes those fees on you.  You are welcome to find a different wallet program, or create your own that does not impose that fee.  You might even manage to convince others to use your modified wallet program.

However...

Your peers are not "required" to relay your transactions.  Each peer is welcome to set their own criteria for which transactions they will relay to the rest of the network.  Many peers will be running the "reference client" Bitcoin-Qt (or bitcoind).  In that case, they will refuse to relay transactions that appear "spammy" if they don't include a reasonable fee.  The fee requirements that most of your decentralized peers have voluntarily chosen (by way of choosing a wallet/client that imposes the requirement) are as follows:

If a transaction has any ouput less than 0.01 BTC, then a fee will be required.
If a transaction is larger than 10 kilobytes (typically because it includes dozens of miniscule inputs from places like SatoshiDice or "Free Bitcoin" sites), then a fee PER KILOBYTE will be required.
If a transaction has a priority lower than 57,600,600, then a fee will be required.

Now even if you can convince enough peers to relay a free transaction that appears "spammy"...

Miners are not "required" to confirm your transaction.  Each miner (or pool) is welcome to set their own criteria for which transactions they will include in the blocks they create.  You are able to provide an incentive for miners (or pools) to include your transaction by way of a transaction fee.  If the transaction appears "spammy", you may find that without a fee as described above, it will take a VERY long time for a miner (or pool) to include your transaction (if ever).

As you can see, the entire system is "voluntary", and "decentralized", but because of certain rules that most peers, miners, and pools have independently chosen to impose (to protect the network from a particular form of "denial of service" attack, it can become very difficult to use without agreeing to pay a fee in certain circumstances.  The wallet you've chosen protects you from accidentally creating a transaction that your peers won't relay and that miners won't confirm, by "forcing" you to pay the fee that the rest of the network is enforcing.

In general I believe that the fee that most wallets enforce is somewhere between 0.0001 BTC and 0.001 BTC.  However, if your transaction becomes very large (in terms of bytes, not bitcoin value) due to a huge number of extremely small inputs, that fee is multiplied by the number of kilobytes in your transaction.  As such you can end up with significantly larger fees (such as the 0.01 fee that you encountered).

If you receive a single higher bitcoin value transaction to your wallet, you'll have a large input that you can use to raise the "priority" of transactions and consolidate these tiny outputs by generating multiple transactions each smaller than 10 kilobytes, but most wallets don't provide an easy interface for this sort of "coin control".  The other option to avoid such significant fees after you've already filled your wallet with these tiny outputs is to wait for the exchange rate to get significantly higher.  Eventually the required fee may be reduced (it was reduced in the past) as the exchange value of that fee becomes significantly large.

Thanks for the info bud it confirmed what I had suspected... You may now go to sleep! lol

No seriously thanks for straightening a few things out for me.

Oh and another thing, I guess the same would apply for when you mine right? Basically it would work out that the people with the biggest hashing power would pay the least fees as they will be getting whole or at least fuller coins?

Kind of a little unfair as they would also be taking the lion share of those fees too right?

I wish bitcoin hadn't gone down the fee route, especially when certain wallets are forcing you to do it.

There's a few formulas to it but the fees are generally set by the miners.
As long as the coins are grouped together with older/bigger amounts of coins during a tx, the fees will be reduced or even removed. I forgot about the details in a moment though - probably as I'm feeling sleepy here. I'm sure someone else knowledgeable will come along shortly. 

Ding Ding Ding... This could be it mate, I did have a little flutter with the "free bitcoin" sites for a few days so I guess that could be the reason for it... I don't use them any longer as it was a waste of time to begin with but now I certainly will not as I probably lost money using them! lol... I mean not that it is much but if I was getting those kinda fees all the time it would surely pee me off...

Now how is this going to work because the longer bitcoin is in use the more fractured the bitcoins will become (if you get me)... So wouldn't that mean the fees will rise regardless of what you do eventually, and just continue to rise too!

I will defo check out those other wallets because long confirmation times wont worry me as they are damn long anyway WITH paying the fees! lol

Who set the fee rate anyway? Is it just written into the code at the beginning?

How exactly? There does not appear to be an option for that, unless you are talking about the optional fee part of the settings?

It might be that you're using those free btc sites a lot, which issues a lot of small transactions to your wallet. That's viewed as spammish transactions that clog the network, so a fee is imposed. I regularly send out 0.1 tx's without having to pay fees as I do not have such transactions in my wallet. Another way here would be to use a client that allows you to set the fees like Electrum/blockchain.info - be warned that it will confirm slower though.

You can use a lower fee, like 0.0002

But yeah, as the exchange rate rises the fee becomes large.

I think I should clarify, the fees I am referring to are when I send coins from my wallet to another address... Oh and also it was 0.27 btc not 0.2 as previously stated, not that it makes much of a difference...

I just think this fee system is really going to hurt bitcoin, can you imagine every time you buy something you have to pay this fee? It really is not good.

I can send money from my bank account to anywhere in the uk for free! And I do frequently. I realize that bitcoin is worldwide and all and I also realize that by mining I have gotten some of these fees already (as the pool I mine with shares out the fees) but still it is kinda hard for me to get my head around the amount and how is deciding what the amount will be... I thought bitcoin was decentralized?

Okay so I'm not exactly new to the bitcoin world but I am new to having my own wallet etc (I used to trade a little bit for a while, more as a hobby) and I have since made a couple of transfers to a particular trading site.

The coins were mined as part of a pool...

Now for instance I just transferred 0.2 bitcoin and for the trouble I was asked to provide 0.01 as a transaction fee, I say asked but really I was forced else I wouldn't be able to send them.

0.01 roughly works out at near on a pound!! What is that all about??

Is there an option where I can lower this fee or stop it completely, I just feel that it is far too high for what I actually sent.

Or is this just the way it is?

Who decides this fee?

I know it goes into the blocks being mined and it helps the network etc but surely this fee is too high and I thought these bitcoin transactions were supposed to have no fees? Wasn't that one of the selling points?

Can someone just clear things up for me because I have tried to search about it and get conflicting information, cheers.