Topic: Bitcoin transaction fees are too high, obstacle for adoption and in general (Read 369 times)

the whole fee market is not about pros and cons.. its about a divergence of poor vs wealthy
the big businesses moving large amounts dont care about fee's because they push their customers to pay fees on withdrawals. however users in 3rd world countries wont like using bitcoin and will instead be pushed into using insecure centralised services/systems..

and yes subnetworks are less secure and more centralised. even now certain ones are starting to require "federations" and "factories" (custodians) to manage users funds of small payments.. pretending these other networks "are bitcoin" when clearly they are not becasue they dont even use the bitcoin blockchain for day to day stuff. heck they dont even want people to close their account channel daily/weekly. the average channel/account lifetime is well over a year on these subnetworks.

But most of the people despite of the many benefits of one thing to people, they are always finding some cons to it to make it consider as not bearable to use. It's like they are validating themselves to not encourage the use of Bitcoin since there's also a negative side. That's why people with the mindset of trying new things to explore and not scared to risk something is the one could get successful one day.

What you've said is actually true, if one thing doesn't have their own fee they wouldn't even last like in the business. Since we're in the era of having a solutions to problems then of course they are already providing solution to that issue about the fees to make it more convenient to use.

High transaction fee on Bitcoin is not an obsolete for adoption, there is demand and there is value, the higher the value of Bitcoin drives up, the higher the transaction will go up too, lets use other crypto projects like Tron for example.

Do you know that people prefer using Tron because of TRC20 USDT? It's cheaper to move fund with Tron, but mind you, the transaction fee of Tron is not the same when we are in a bull market, the fee goes up too, but it's unnoticeable to many because the value of Tron itself isn't even up to 1$, the highest I have seen Tron at was 0.22$.

Let's assume that Tron climb up to 50$ some day, the transaction fee will be way higher too, because you are using Tron itself to pay as the gas fee.

Bitcoin's benefits, such as decentralization, security, and the potential for financial sovereignty, continue to attract users despite transaction fees. As more individuals and businesses realize the advantages of Bitcoin and its potential for different use cases, they may be willing to accept fees as a necessary aspect of using the network. Furthermore, the continued evolution of scaling solutions, layer 2 protocols, and advances in technology can help mitigate the impact of high fees. These improvements aim to improve efficiency and reduce transaction costs, ultimately making Bitcoin more accessible and user-friendly.

When Bitcoin emerged with all its advantages, many rallied behind it and reaped its benefits. When Bitcoin encounters new challenges, shifting to altcoins isn't the ideal solution to fully embrace Bitcoin. It's okay to wait a little longer for transactions, as it gives you some time to rest or enjoy other pleasant activities. Just don't focus on time, but rather think about other positive aspects of loyalty.

Regarding the issue of mass adoption hindered by high fees, you can explain that this is an inherent characteristic that occurs infrequently in time intensity. So, it's just a matter of time, and it will normalize again in the near future.

And this shows basically that the price is more important than usage, any normal business that would have experienced this type of congestion would be bankrupt, a bank raising the fees this much would be left with no customers, but since crypto on-chain usage is like 1% of the importance of trading and investing, here we are. And here we will be at the next spam wave since nothing is really being done.


That's not how the network works, that's not how sanctions are being confirmed.
It takes a script that can run on a Pentium 1 to generate 10000 ordinals, it takes the same hashing power to create a block right now even if it's empty or it has 4000 transactions in it.

The high fees are actually a barrier to entry and discourage some individuals from accepting Bitcoin. While Bitcoin's transaction fees are high at certain times, it is worth noting that fees are not fixed and can change depending on network conditions. During times of low network activity, fees can be significantly lower. Additionally, using certain strategies, such as optimizing transaction settings, choosing the right fees, or using second-layer scaling solutions like the Lightning Network, can help reduce fees. In the meantime, you should consider alternative cryptocurrencies for specific use cases where fees are lower or transaction times are faster.

That's a tough problem. The problem with all the digital money systems (both crypto and fiat) is that its highly dependent on data traffic volume and data processing power. So increasing number of NFT minters loads all the mining facilities, so that it becomes impossible to make transactions in time. The only way to deal with the problem is to raise transaction fees, it reduces the overall number of transactions, since people start refusing to make them (the law of market). That's why such things ($10 purchase, $30 fee) happen.

Developers are doing their best to solve the high transaction fee issue.  Developers had implemented two soft fork in order to minimize the transaction fee.  The first one is segwit and the latest one is the taproot.  The current high fees is due to the Bitcoin Ordinals feature that enables the creation of NFT that congest the network.

The developer knows what they must do, so I think there is no need to remind them about the urgent need for Bitcoin to scale.

The high fees is truly a menace that needs to be tackled heads on, it shouldn't be given any breathing space until the goal is achieved, and what is the goal if you ask me?

I understand that the current transaction fees for bitcoin is at the $3 range at the moment, for me, that is still pretty expensive for a bitcoin newbie who is just gathering funds to buy bitcoin and withdraw to his or her wallet, bitcoin should have a transaction fee that is not more than $0.5 at most, this is how Marchant and business men and women can also be motivated to implement bitcoin payments into their businesses.

What they offered was nothing, they only promised high tps blockchain without actually demonstrating that it has the claimed capacity while also remaining decentralized. And of course the developers never had interest in delivering, they already got filthy rich from their premine.

If there was a coin that had better scalability than Bitcoin without any downsides, it would have been still alive today at at least $2 or #3 spot and slowly replacing Bitcoin. But there is no such coin.

The state of bitcoin was pretty bad last month, but for now on the bitcoin network, it is improving, and it is likely that fees will continue to stabilize and become more affordable over time. So if you are still too heavy on the issue of fees, it is better to use other networks, such as Matic. I find the network to be quite good, and it is a practical solution to avoid high fees and longer confirmation times. Also, I have seen a spike in ETH network gas fees in the past few days, so I don't recommend using this network to transact payments.

I'm not sure what you are talking about, Bitcoin transaction fees are not as high as you are saying at the moment, you will barely have to pay $3 or something for the priority transaction if you are using the lightning network and for the lowest fees it is just a few cents per transaction. We know that the network gets congested sometimes but that is not the case right now.

The scalability issue will surely be solved if it's seen to be too much of an issue in the future but for now, the network does pretty well in normal times, it is only a few occasions when transaction fees go very high just like what happened recently.

the biggest issue is when withdrawing btc from exchanges to
your own wallet Binance has a fees of 0.00025 btc for normal btc and 0.0005 btc for segwit which
 is too high around 7$-14$ and hitbtc worst i think its 0.00075 btc

You have to realize how minimal those gains were when we're talking about global adoption.
Even with the extremely small size of brc20 minting that pushed the number of confirmed daily transactions to a record of +600k, it's still on average around half a million, Mcdonald's has 70 million customers a day, just as an example.

If a 2 million tx made out of ordinals ravaged the network this badly, how are we going to deal with a million users daily?


Maybe because what they fixed was not actually what people want?
The market hs shift is terrible, there is less and less action on blockchain that has a counterpart in the real world, we have insane flows that are basically just people sending coins from and to exchanges, and in the case of altcoins through that defi and "investing" platforms.
The other coins have failed because they failed as an investment tool, what they offered was simply in no demand.

Now, what if Bitcoin hadn't had this problem at all, maybe we would already be further down the road of adoption?

Many people don't know this but it is the truth about Bitcoin, you are all buying bitcoin today to hold for the future so that you can sell at a higher value but you are complaining about the transaction fee.

If you want Bitcoin to reach a new all-time high in 2025 then you should know that the gas fee will never be the same but if using Bitcoin as means of payment and it is the only thing that matters to you, then do not expect 200,000 dollars per Bitcoin for you to be able to take profit.

Bitcoin will remain in the same place in terms of value if we all want cheap transaction fees, the more value Bitcoin has, the higher the transaction fee will be.

Get used to this right now OP, because sooner or later, the transaction fee will increase.

These updates sure did technically decrease transaction fees, but the effects were (expectedly) minuscule. Segwit was mostly for increased block capacity, while Taproot was mostly for better functionality via the Lightning network.

Bitcoin is still undergoing development and the two soft forks that happen in Bitcoin development is somehow related to minimizing transaction fee.  If we look at the history, Bitcoin first implemented  segwit.  A bitcoin update that reduces the size of transaction, thus making transaction fee lower.  Then comes taproot that further reduce the transaction fee.  Before the ordinal issue, Bitcoin transaction are cheap, until someone uses BRC 20 token to congest the network and eventually increase the transaction fee exponentially.

If this is not sustainable, then people will use Bitcoin less, if Bitcoin is used less, the fees will drop, if the fees will drop, Bitcoin will become used more, if it's used more, fees will rise, if fees will rise, someone will make a post on Bitcointalk how this is not sustainable 

This problem has existed for many years, and Bitcoin is still the #1 coin with no competition. Countless coins claimed to have solved scalability, and they are in dust now.

Well said Dr.strange, it will definitely affect those newcomers like myself although I will count myself as a partial newcomer as I have already started my bitcoin investment and my investment and portfolio is looking stronger everyday but what about the folks that don't want to use it as an investment and only for transacting purposes? They will definitely see it with another motive as it will be really absurd to spend more than half of your money as fee trying to pay for a service rendered to you.

I really do understand that it's something we are going to get used to, but speaking for ourselves as early Bitcoiners, it might not really have much of a negative impact on us, but for newcomers, can they cope? If they are in the situation of buying, say, $10 of Bitcoin for the first time and they are to spend $30 in fees, it will discourage some people and make some people more skeptical about the technology, mostly people who will know about Bitcoin for the first time in their lives.

When I first bought my first Bitcoin some years ago, around 2019, I didn't buy a whole lot of Bitcoin, and I didn't spend up to $2 on fees, so imagine if I were to spend $30 on fees when I wanted to buy $100 worth of Bitcoin. It would really make me feel biased that I had to just receive $70 worth of Bitcoin if I spent $30 on fees.

I just wished for the Bitcoin transaction fee not to go so high that newbies could not afford it when they wanted to buy their first Bitcoin, because Satoshi said Bitcoin is for everyone, both the common and uncommon man, and some common men, could not afford to spend a lot on fees.

Cheers 🥂, Dr.Bitcoin_Strange 👺👺

This is just a simplistic and overly optimistic take.

There are a couple of issues with this take and a lot of people ignore a ton of problems:
- you can't always use just one input if you constantly deal with BTC, at one point you will have a ton of dust that you will need to consolidate and it will cost you twice as more to use that.
- when you pay with BTC there are cost for the seller too, he does receive the BTC free of fees, but he MUST USE them, so he will pay also to move that money, even if it's consolidating, moving to cold storage, moving to an exchange!

But the worst thing is the take that all you have to do is wait, seriously?
That was supposed to be an economically viable alternative when you have to wait for weeks to make a transaction that is finally cheaper than a WU transfer?

Oh, but it's good for people making millions and moving millions every day! Suddenly from hating the bank and the rich elite controlling the economy, now we cheer for a solution that is 10 times more expensive than a CC but it's doing great at moving billion for a bunch of dollars
This is copium! Pure 100% fentanyl free copium!

Bitcoin needs to scale! That's it! Simple!

15 sats per byte to get included in the next block currently. I don’t mind paying less than $1 to transfer money anywhere in the world on the most secure network in the world, with no middlemen.

https://mempool.space

Well thats not true. Bitcoin's tx fee were way higher while the prices were way too low a few years back. But later, after the segwit implementation, the fee has been reduced drastically compared to what it was before. We will always have more new solutions in the future too, so cant say that its success will be directly proportional to the fee.

This is a very rare case, where the transaction fee could end up high like this especially before, the bull market, where the price of Bitcoin is at its peak, and multiple all-time highs were created, that's the time that I can recall that this kind of high transaction fee happened.
I can feel what OP is saying here, Bitcoin for this kind of payments is not that really good, but I believe there will be more technology will come to solve this issue of Bitcoin.

If you end up paying such a high amount on fee for such a small transaction in Bitcoin, then is definitely the platform that adds additional fees for processing the transaction because Bitcoin transaction fees shouldn't be more than $3 for such an amount, even when the network is mostly contested.

Talking about the issue with Bitcoin network congestion that pushes out high fees, it is not a new thing while some are natural other are attacks on the networks but the good thing is that, it doesn't last for long before it will get resolved and feel back to normal.

Where did you see that? I have never ever paid 30 USD in fees on transactions with 1 input 2 output or 2 input 2 output. If you are going to send $0.5 to 20 users, then you'll have to pay $30 in fees but in the situation that you describe, there is no way someone had to pay $30 in fees in this year.

---

By the way, transaction fees are actually problematic in bitcoin world. To my mind, Lighting Network looks promising and I hope service providers will adopt it and offer payments through LN.
Or another unpopular but my favorite solution will be to increase block size but the problem is that majority of people somehow don't like this idea and say things like it will increase the blockchain size, will be more costly to run node and so on but that can't be and actually is not a problem today.

Indeed, there are instances when transaction fees can be costly. However, it is crucial for individuals to proactively seek out alternative solutions. For instance, when making a purchase, one can simply inquire about the available payment methods. It's a straightforward approach that can save unnecessary hassle. By adopting this mindset, finding more cost-effective options becomes effortless.Why bother like that, I think it's easy.

As others have mentioned, the fees are currently just a few dollars, which is still significant for a small purchase but not nearly as bad as the op describes. Fees that are more than $10 are pretty bad and a big obstacle for adoption, but this only lasted for 2 weeks in 2023, and the last fee spike was 2 years ago (although that one was much longer).
It's still a challenge when it comes to small purchases and direct on-chain Bitcoin transactions, but that's just the way it is, and there are centralized solutions to this issue, even though I agree it's not ideal.

Why do people buy $10 stuff with Bitcoin? For what stuff? That doesn't make sense because they have to pay $30. The last time I sent Bitcoin for $30, it only cost around $1.5, which made sense to me.

Yesterday's incident of increasing transaction fees came suddenly and took a lot of people by surprise but it didn't last long. And now the transaction fees have dropped dramatically and you don't have to pay too much.

The important thing is that if you don't mind paying the transaction fee using Bitcoin, you don't have to. There is no compulsion you have to use Bitcoin and there are other cheap coins.

The OP refers to the situation that was current at the beginning of the last month or so, and in some moments the fees were really high. This has happened before in the past, although for some different reasons than today, but the effect on the price of transactions is always the same.

What most people who think they know about Bitcoin get wrong are things like "Bitcoin is an anonymous and cheap way to transfer value", and we know that neither is correct. That's why every time things like this happen, we have those who are disappointed in the system and think that something needs to be fixed.

It's not that I'm happy (like many) that some have decided to use the BTC blockchain for their meaningless games, but at this point it should be understood that those who do it (for profit) and those who support it for extra profit (miners) are a lot stronger than developers or us mere mortals.

There is a thing called blockchain trilemma. It consists of three factors; scalability, security, and decentralization. Increasing scalability tends to compromise security or decentralization. So it can't be a single thing getting first priority while ignoring the other one. We must also consider security and decentralization, and make all things balanced.

People who actively contribute to the developments surely trying to tackle the scalabilities issues. They didn't make it the main priority dues to some obscure reason, but simply a tricky technical challenge. As an attempt to improve scalabilities, people develop the solution in L2 layers like Lightning Network.

Right now you only need to pay less than $1 to proceed a BTC transaction, how it's possible you can say people are paying $30 for fee? if the fee is higher than the amount he want to transfer, I believe no one will make a transfer. Maybe you're talking about centralized exchange where they ask a high fee, this is why you shouldn't use a centralized exchange if you only trade small amount money.

ETH fee is more expensive than BTC, have you try to send a token in ETH network?

It will be sustainable as long as there's no way to break the Bitcoin security, but only middle above class can buy Bitcoin.

Most people like me have become used to the fees already. If this has always been the fees attached with when transacting with Bitcoins, it will be normal. As time goes on I believe that the new fees will become normal people will get used to it and it will not be a problem or an obstacle to the adoption of bitcoin. The only people who would know that the fees were much lower at that time will be old people like us who know what the fee used to be. New people who would adopt Bitcoins will consider the fees as normal. The other benefits of Bitcoins is still enough to attract people.

On 2017, the fees were much higher than what we're expecting and everyone has survived that phase. While on this phase, the fees has gotten lower and we'll surely survive on it. We've got no choice but to pay for whatever the network is suggesting us to pay. There are wallets that have a lot of BTCs where it's collectively gained by the owner of it so the size of that transaction upon doing the transfer is much higher thus, fee goes up. With those cases, there's no option but this is the reality that we're facing. It could be or couldn't be sustainable but Bitcoin has faced a lot of challenges before and so this one as well and I am sure that we'll pass on this one.

It's going to be worse as time goes as retail transactions wouldn't mostly be done on the base-chain in the first place — you've been here for a while now so you should probably know by now that Layer2's (and centralized platforms) will be the transactional layer in the future.

I don't want to get used to it though, it seems a bit absurd that the fees are expensive, I mean there should be ways to make sure that problem is solved right? Or at least people working on how to lower the fees? One thing that I can think of is fee optimization but I've had an experience with it and I don't think that it's a good solution. I share OP's sentiment about the fee being an obstacle to adoption.

The Bitcoin network was congested very badly in those days only because of the Ordinals protocol like BRC-20, and that was the main reason for those very high fees. The situation was really bad that some transactions required far higher fees than the amount of transaction itself. But the condition is getting better right now and the fees are reducing on weekly basis, and I'm sure that soon they fees will be in their normal range. The current network fee is around 5.43 with expected transaction completion time of around 60 minutes on Binance exchange. The fee may vary depending on a wallets auto-set fee, but that won't be any higher than 6$, and that's not a very high fee. If a service allow BSC transactions then the fee is below 15 cents for such transactions.

I have personally used some altcoin transactions during the congested market and I don't think that anything is wrong with Altcoin transaction in such times. I used Litecoin for transactions in those days and its fee was very low for me. I prefer Litecoin over other altcoins in such situations because it's far better than ETH in my eyes for small transactions.

Who here wants to pay 30$ in transaction fees just to buy an item worth 10$?
This is the reason why Bitcoin will always be an alternative mode of payment, and not a main mode of payment. It's the fees which sometimes is really high like what happened a few weeks ago. Why pay using Bitcoin when you can use fiat to buy it?

Higher transaction fees = more exposure to Lightning Network. As transaction fees goes up, people will find an a better way to make Bitcoin transaction, and Lightning Network is the most recommended by others. You have 2 options though, either use LN, or use altcoins if you really want to pay using crypto.

What do these people supposedly buy that is worth $30 and they can't buy with fiat?

Leaving aside specific cases, regularly paying a $10 fee to buy items worth $30 is not very smart, and if we take into account that you are doing it with a financial asset that tends to appreciate greatly, unlike fiat whose depreciation is constant, it borders on being stupid.

Today Bitcoin is more a store of value than a currency, and everything indicates that it will continue to be so in the future, so it is better not to trust that in the future you will be able to make payments of $1 with the minimum fee that will be confirmed fast.

Try to buy $30 of gold and then sell it to buy something or pay directly with it where they accept it and come back here and tell us how much they have charged you in fees.

Bitcoin isn't perfect but people can make their transaction with lower transaction fee and still be able to buy wanted items. Like you want to save your money, prepare money for Black Friday with massive discounts on many things.

With Bitcoin, you can choose times to make transactions with cheaper fee, like weekends and when mempools are not too congested. If you can prepare more like consolidate your inputs when fee is cheap, you are good when fee is higher or expensive. Use Segwit address bech32 bc1q for your transactions. By doing this, you self help yourself and minimize cost for your transactions.

People can choose altcoin networks, stable coins for cheaper fees when they don't see fit to use Bitcoin network.

The mempool has gotten down to 16 sat/vbyte recently and not getting much higher than expected, unlike what happened when Ordinals and Inscriptions transactions began that led to mempool congestion.

You can use lightning network. Or get use to the onchain fee as odolvlobo commented earlier.

Well, you will have to get used to it. This is what is will be like in the future. Bitcoin's success means higher fees.

Well, currently there is no more than a $3 dollar transaction fee and you are saying people have to pay $30 dollar fee on 10 dollar worth of transactions. You can check for yourself from the Bitcoin Fee Graph that it was in the previous month when the fee reached to 30 dollars but after that, like after 18 May, the fee begins to reduce and now it ranges from 3 to 5 dollars if i am not wrong. And, i think it is still not that much for those who are making millions of dollars of transactions because they are still paying less than 10 dollars (max) to transfer funds from wallets to other wallets or exchanges.

Well, when Defi projects were inscribed into ETH in past, then it was also congested like BTC, and still the transaction fee on ETH is more than BTC idk why you mentioned ETH. I do not know about LTC but according to graphs, the fee is less than cents. Well, it also depends on the functionalities and adoption of the token, And despite the fact of high tx fee, people are still using it but few no doubt have left BTC as a payment method.

You are a bad motivational speaker (haha) just kidding no disrespect. So you have chosen the side, as there are many people who do not want this ordinal problem to get solved and many developers are also included among those people. But no doubt there are others too. Well, let's see what good this problem will bring when its solution will be released. But till then, people are making hell lot of money out of BRC-20 tokens.

Hi,

I just wanted to share my thoughts about the high Bitcoin transaction fees.

I see people paying USD 10 for an item, and then paying USD 30 in fee for the BTC transaction, and I realize that this is not sustainable. And its impossible for BTC to become a mainstream payment method if the price is increased with x3 when you buy something.

I understand that the "network is congested" and im sure people are working on it. But in my opinion this should be top priority no 1! It is hard to explain to people all the time that they should use LTC or ETH or something else when we just started to get people to trust Bitcoin.

What is my suggested solution? That the people that can actually do something about this, the people involved in the development, start to act like grownups and sort this issue once and for all!

Im not going to solve it, not with this article and not by complaining. But others can and they should!

This is not sustainable over a longer time. Bitcoin popularity might be increasing but with fees like now it will never really work.

Please some intelligent involved developer read this and get motivated!

<3