Projected Transaction fees for bitcoin 2015-2030?

DeathAndTaxes

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Gerald Davis

Quote from: Bitcoin++ on May 14, 2014, 05:08:09 AM

Because of competition the fee will remain at almost zero.

You find a block, what do you do? A rational miner will take all transaction with fee >0 (greater than zero but not zero), even if only 1 satoshi. Otherwise the miner who finds the next block will take it. This is how competition works, and this is one of the best features of bitcoin.

That is not correct. While competition will keep fees down miners do face orphan cost. Larger blocks means longer propagation time which means greater % of blocks lost to orphans. It doesn't make economic sense to add transactions who's fee is below the orphan cost. How large the costs are and how rational miners act can be debated but a fee of 1 satoshi is for all intents and purposes a fee of nothing.

Soros Shorts

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Quote from: byt411 on May 14, 2014, 10:54:30 AM

Quote from: Bitcoin++ on May 14, 2014, 05:08:09 AM

Because of competition the fee will remain at almost zero.

You find a block, what do you do? A rational miner will take all transaction with fee >0 (greater than zero but not zero), even if only 1 satoshi. Otherwise the miner who finds the next block will take it. This is how competition works, and this is one of the best features of bitcoin.

If one miner controlled the entire network he could set the fee much higher. It would be foolish of him not to. This is why visa, paypal, okpay etc have stiff fees. Once you control the network you can milk it. No one will is able to do so with bitcoin.

A special case for bitcoin is when the number of transactions exceeds the block limit. In this case the miner fill block with the transaction with the highest fees. This in turn will force users to increase their fees. Now it is not a big issue, but as far as I understand one of the great challenges forward is to go from the current heuristics to a market based system.

As a side note: Why is it so that he who is wrong usually laughs at he who is right and not the other way round?

First, I am not wrong.
Second, I find a block, I include as many transactions as I like and the ones that I want. I can include no transactions if I want to, but I would include the highest fee ones. All pools do the same, so fee wouldn't go lower. Even if I included more transactions at a lower fee, I would end up earning much less than if I include less with higher fee, such as a 2.8BTC one.

You are implying that there is cartel formed amongst the pools to keep the fees high. I believe you are wrong, because I have had zero-fee transactions confirmed even as late as last week. It just takes longer to confirm (like 24 hours).

byt411

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Quote from: Bitcoin++ on May 14, 2014, 05:08:09 AM

Because of competition the fee will remain at almost zero.

You find a block, what do you do? A rational miner will take all transaction with fee >0 (greater than zero but not zero), even if only 1 satoshi. Otherwise the miner who finds the next block will take it. This is how competition works, and this is one of the best features of bitcoin.

If one miner controlled the entire network he could set the fee much higher. It would be foolish of him not to. This is why visa, paypal, okpay etc have stiff fees. Once you control the network you can milk it. No one will is able to do so with bitcoin.

A special case for bitcoin is when the number of transactions exceeds the block limit. In this case the miner fill block with the transaction with the highest fees. This in turn will force users to increase their fees. Now it is not a big issue, but as far as I understand one of the great challenges forward is to go from the current heuristics to a market based system.

As a side note: Why is it so that he who is wrong usually laughs at he who is right and not the other way round?

First, I am not wrong.
Second, I find a block, I include as many transactions as I like and the ones that I want. I can include no transactions if I want to, but I would include the highest fee ones. All pools do the same, so fee wouldn't go lower. Even if I included more transactions at a lower fee, I would end up earning much less than if I include less with higher fee, such as a 2.8BTC one.

Bitcoin++

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Because of competition the fee will remain at almost zero.

You find a block, what do you do? A rational miner will take all transaction with fee >0 (greater than zero but not zero), even if only 1 satoshi. Otherwise the miner who finds the next block will take it. This is how competition works, and this is one of the best features of bitcoin.

If one miner controlled the entire network he could set the fee much higher. It would be foolish of him not to. This is why visa, paypal, okpay etc have stiff fees. Once you control the network you can milk it. No one will is able to do so with bitcoin.

A special case for bitcoin is when the number of transactions exceeds the block limit. In this case the miner fill block with the transaction with the highest fees. This in turn will force users to increase their fees. Now it is not a big issue, but as far as I understand one of the great challenges forward is to go from the current heuristics to a market based system.

As a side note: Why is it so that he who is wrong usually laughs at he who is right and not the other way round?

byt411

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Quote from: Bitcoin++ on May 13, 2014, 04:21:48 AM

Isn't it so that each miner can choose which transactions to include/reject?

Today, as far as I know, all miners use the same standard heuristics for including transactions. There's no reason it shall remain this way.

The cost for a miner to include an additional transaction is (almost) zero. Therefore it makes sense to include any transaction with fee >$0 rather than giving the fee to the miner who finds the next block. In theory the transaction fee would fall to one satoshi.

However, there is a capacity constraints that caps the number of transactions. Imagine if it really only did cost one satoshi. Some would spam the network. Others would find legit ways for micro-transactions such as $0.0001 for downloading a web page etc.

With the cap in mind there should always be some fee, but it is likely to remain very low.

LOL. I'm just ROFLing right now.
You are like extremely wrong. The cost is almost zero, correct. You buy a bottle of water for $1.45. What's its manufacturing cost? $0.15. Then why not leave it at $0.15 and sell it?
Because people are greedy and want profit. It makes sense to not accept zero fee transactions, why not earn the money when it's just sitting there?

Bitcoin++

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Isn't it so that each miner can choose which transactions to include/reject?

Today, as far as I know, all miners use the same standard heuristics for including transactions. There's no reason it shall remain this way.

The cost for a miner to include an additional transaction is (almost) zero. Therefore it makes sense to include any transaction with fee >$0 rather than giving the fee to the miner who finds the next block. In theory the transaction fee would fall to one satoshi.

However, there is a capacity constraints that caps the number of transactions. Imagine if it really only did cost one satoshi. Some would spam the network. Others would find legit ways for micro-transactions such as $0.0001 for downloading a web page etc.

With the cap in mind there should always be some fee, but it is likely to remain very low.

cuddaloreappu

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Quote from: a7594li on May 11, 2014, 07:33:23 AM

the fees is high,the bitcoin is worthless.

i think you are trying to say if transaction fees are high then bitcoin is worthless as it becomes on par with traditional institutions like western union and paypal

makebitcoin

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Quote from: byt411 on May 11, 2014, 07:00:46 AM

Quote from: makebitcoin on May 11, 2014, 06:59:59 AM

I've never understood this. Will the transaction fees have to rise because the miners don't mine anymore blocks or will they go down because Bitcoin will be worth more in other currencies like the USD?

Because the Block Reward will halve, and miners will earn less, so they will probably accept transactions with a higher transaction fee, so that they can earn more.

Thank you for your reply. I understand now.

byt411

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Quote from: a7594li on May 11, 2014, 07:33:23 AM

the fees is high,the bitcoin is worthless.

Please expand on your statement and state your reasoning behind this. I don't see why Bitcoin would become worthless, if supply decreases and demand stays the same, the price will go up.

a7594li

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the fees is high,the bitcoin is worthless.

byt411

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Quote from: makebitcoin on May 11, 2014, 06:59:59 AM

I've never understood this. Will the transaction fees have to rise because the miners don't mine anymore blocks or will they go down because Bitcoin will be worth more in other currencies like the USD?

Because the Block Reward will halve, and miners will earn less, so they will probably accept transactions with a higher transaction fee, so that they can earn more.

makebitcoin

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I've never understood this. Will the transaction fees have to rise because the miners don't mine anymore blocks or will they go down because Bitcoin will be worth more in other currencies like the USD?

cuddaloreappu

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Give your suggestions on how ,many transactions on average could happen and what will be the transaction fees in future..

So when mining reward go down transaction fees will help miners..

if you own 100Gh of power how much could you earn through transaction fees?

Topic: Projected Transaction fees for bitcoin 2015-2030? (Read 1114 times)