Topic: Future Transaction Fees (Read 2795 times)

You just have to wait, that is probably 30 years away from now if the dollar does not devalue too fast. The transaction fee will be able to support the network.

Exactly, this is what is great about Bitcoin as a technology.  Everything was built in and planned.  What a great mind to forsee all of this.

This is actually a very large and forward-looking topic, tied to the discussion of block size limit

It is forward-looking because currently majority of the miner's income is coming from block reward(25 btc per block), the fee income is neglectable

So you can observe that some chinese mining pools would mine empty blocks to just harvest the block reward and quickly broadcast that empty block to the network (their network speed is slow, if they broadcast a full 1MB block, the chance that block being orphaned will be larger, thus incur a loss for the pool)

Basically, a smart pool will calculate the block orphan risk when including transactions (more transactions will raise the orphan rate due to longer broadcasting time), so today's recommended fee is based on the result of such calculation, not arbitrarily decided

For example, if a full 1MB block containing 2000 transactions will broadcast slower than an empty block, thus raise the block orphan rate by 1%, then the pool will lose 1% of the block reward, which is 0.25 BTC, divided by 2000 transactions, you get 0.000125 btc per transaction, that's the recommended fee right now

For 2MB blocks, the broadcasting time of such a large block might affect the orphan rate more significantly, say raise the block orphan rate to 4%, and now you can include 4000 transactions in each block. As a result, although each block have double amount of transactions, but a full block will cost 4x more for miners, so the fee for each transaction would double

So increase the block size might bring a higher fee, if the network is not fast enough to broadcast a 2MB block worldwide in 10 minutes



And then you have another scenario of fixed block size at 1MB forever. In this case, the transaction capacity is always 2000 transactions per block, people will compete for these limited spaces, and also combine their small transactions into large ones to save the fee. Just like Fedwire system only processes 4 transactions per second, if bitcoin become a system like that, then it will only process large transactions valued more than 1 million dollars, and users would not mind paying thousands of dollars in fee (0.x%)

There is a question: Should miners incentive be raised above block reward long before the block reward drop to zero(even at 4th or 5th halving), or after that?

Currently, due to the block reward, you can not enforce a higher fee for miners, since the miners on today's fast network have very low orphan rate if they include all the 2000 transactions, thus any fee above 0.0001 is good enough for them to happily include it

However, if block is larger and the network speed is limited, miners can not include as many as possible transactions without added orphan cost, then I guess the fee will rise when blocks grow beyond certain size

It is possible for the network to adjust the amount of transaction fee whenever it is desired. Indeed with the increasing bitcoin price it will become a problem in the future but it can be easily solved.

That's utterly ridiculous they will obviously adjust the miners fee.

it's simple the higher the value of BTC the lower the transaction fee will be lower so it will adjust by the value of BTC at that time

1BTC equal to £1 000 000 i cannot wait for that to be the case.......

The fees are always adjusted. Thus, of course there is not enough bitcoin for everyone in the world own one, and that's the beauty of it. If BTC one day worth $10 000 then the new standard bitcoin would be the millibit, and the fees would be adjusted; And that would be perfectly feasible, considering the huge number of transactions.

If prices will skyrocket they ll ofcourse adjust the transaction fees. No need to worry mate

I don't think that fees will change with the price of BTC. Maybe they will change paralell with the price of BTC but not because of it. It can happen that the price will raise and because of the raise of the price more and more people will start using BTC. It will then make fees raise because people will have to pay more to get their transaction included. But this raise of the fee is not because of the price raise it's just starts some market movements that can raise the fees but this is not automatic.

There will always be a standard fee governed by market forces. If the fee is too high in fiat value, users will try to pay less. When more people send with less fee, the standard fee is lowered. Transactions are still "standard" if fee is above 0.00001 btc, set by a variable in bitcoin core code.

Transaction fees will be changed according to the Price of BTC (In case there is no inflatation of the Fiat currency).
Fees should never reach a price, its not worth to pay anymore

there is no need to worry. as long as the price goes up high enough, the mining pools will get their rewards and thus make good profits. then there basically isn't a direct need to raise the fees.

1 satoshi will be the last one, when the price will reach very high, the halving period will be at the end, but that is far away from now probably.

this is not how it works. fees have nothing to do with USD/BTC value
I doubt we will even see .01 fee in the future even if BTC hits $10mil

I honestly wish we would have this problem in future. This would mean that Bitcoin has made it huge! If this was to happen, I am not that worried. Everything in Bitcoin can be changed and I believe if we would encounter this fee problem, that this would be solved as well! So no worries!

I dont think that bitcoin transaction fees will grow as u r thinking because if this happens people will start avoiding the use of bitcoin .

sadly this is not the case, the fee will not be lower, what will be lower exactly is the amount you spend, because bitcoin will be worth more

this also mean that you will use less fee, so in the end yes the fee will be lower, but indirectly speaking

I don't see this happening, as everyone else here said, it's not fixed so it can always change.

I don't mind it going a bit higher if the value goes up by 1.000.000

As long as I pay the same fee for every transaction

More like 100 Satoshi if Bitcoin price is around 4/5k.

But it also depends how big competetion is there to be included to the block. Today the competetion is not so big because blocks are not filled up all the time. But soon it can happen and the fees have to increase if you want your transaction included in the block - fees rising scenario until it makes no sence to use Bitcoin for average user because of very high fees.