Topic: Transaction Fees are SPIKING ! - page 2. (Read 5685 times)

This is getting to be silly.
Sent 0.009btc just now and it took $0.34 in fees to send it. Usually pay half of this in transaction fees to send the same amount last week.
It cuts from the total amount you have in your wallet available to send. Simply prosperous!

Just received a notice on bitify that their raising their rates to not have to lose out on paying these high fees in using their escrow service even.

 Changes to the Fee System
As many of you might be aware, the Bitcoin network has recently been struggling to keep up with the number of transactions being sent each day. This has resulted in some transactions taking considerably longer than usual to be confirmed by the network, as miners choose only to include transactions sent with the highest of fees. A few months ago, in an effort to ensure that your funds confirm as quickly as possible, Bitify made the decision to increase the fee we pay when sending your transactions. This cost was absorbed by us and had no effect on our users except for transactions confirming quicker. Unfortunately many other businesses followed suit, pushing fees even higher, to the point where some transactions are again taking many days to confirm when the network is under heavy load.

Over the last 3 months the amount paid in network fees by Bitify totals more than our previous 3 years combined, yet we find ourselves needing to increase the network fees again in order to compete with the current congestion on the network. To allow us continue to provide our customers with a great service and acceptable transaction confirmation times, we regret that Bitify can no longer continue to absorb the increasing network fees required by the Bitcoin network.

Bitcoin Fee Increase - Blockchain.info
Blockchain.info – Total Transaction Fees

As a result, going forward Bitify will deduct the network fee from all amounts sent to sellers/buyers. This network fee will be adjusted in line with the current Bitcoin network load, meaning that the fees you pay will reduce when the Bitcoin network is quiet, and increase when it is busy. At all times Bitify will pay the Bitcoin network the recommended fee in order to include your transaction within 5 blocks (50 minutes average).
Starting today:
– The final amount charged by Bitify will include a network fee, deducted from the amount sent.
– Sellers will be charged 2.5% or 0.001 (whichever is higher) + network fee.
– Buyers using Escrow will continue to be charged 1% or 0.001 (whichever is higher)
– Buyers requiring a refund will additionally be charged a network fee, deducted from the refund amount.
– The network fee will be calculated at the time the transaction is sent, and will be relative to the current network load.

The Bitcoin core client can only estimate the current fee required per KB of data in order to be included within our required time frame of 5 blocks. This is the rate at which we will apply fees when sending transactions. However we cannot calculate the exact fee required on a particular transaction before the transaction is sent. Therefore the network fee amount we will charge users will be calculated as the average charged to us by the network over the previous 25 transactions. This will mean that the actual fee paid by us to the Bitcoin network will vary slightly from the network fee we charge you, but since this can be higher or lower, on average this variance will be negligible.

For reference, the current average fee we are charged by the network is just 0.00015 (around $0.19 USD)

We regret that we have had to make this change, but unfortunately it is no longer sustainable for us to absorb the network costs whilst keeping our low fees. On the plus side! You will no longer have to wait more than 5 blocks for your transaction to confirm.

https://bitify.com/changes-to-the-fee-system/

Happy Bitcoining,
Bitify Team

What is going on with these fees sky rocketing?

Should I have said it in every post that I consider the situation when there is no mining reward already? I emphasized that twice in one of my previous posts


If you ask me, that's bullshit

There is no huge transaction traffic apart from scammy transactions which are likely made by rogue miners themselves to get even more fees. Price is determined on exchanges, and trading there doesn't need any transactions altogether, especially when you just buy bitcoins as you assume in your post ("it has caused some huge users to invest in bitcoin"). That would certainly increase the number of fiat transactions, but Bitcoin miners have nothing to do with that

Transactions fees are really spiking these days even exchange sites are not making it any easier as they now charge for both deposit and withdrawal which is not the case before but the way it is I think the transaction fees are moving in the same direction that price of bitcoin is also moving which I also believe should be so in case we witness a price crash so we wont be losing at both ends. However, we should also not be unmindful of the fact that compared to other platforms of making some transactions, bitcoin fees is still the compared to paypal or western Union.

Of course it doesn't depend on fees right now and won't for several decades.  That's what I've been saying.

I don't really feel that we have "strong security" right now

Or how it will be less stronger when there would be no or low fees. Basically, the level of security doesn't in the least depend on fees. It depends on the number of miners participating in mining. In fact, it remains to be seen whether with lower fees we wouldn't have stronger security than what we have presently. And presently we have just a dozen of miners confirming 99% of all transactions (that's why they are evil). Personally, I wouldn't call that strong security. If they are gone, the playing ground will become more level, and thus more competition between miners will set in which would raise security, not lower it

Felt like making an a side note to your most recent comment.

If someone introduced a fork that rewarded nodes for participation in the Bitcoin network and increased the block-size as part of the package we would see a fork get approved pretty quickly an area that would be viable is incentivizing the Bitcoin nodes for doing work and is one way a fork could be forced.

I'm for the we support the Bitcoin Nodes camp and let the miners responsibility being a reduced part of the equation, if the nodes leave with the expanded blocksize its a viable concurrent chain, and when we look at Saotshi's design its not a far stretch to say that Nodes are our backbone and would rationally be deserving of some rewards for hosting the network but that would be a hard-fork and also demand a change of block rewards.

That said Bitcoin nodes don't get enough support right now for just being around to relay transactions and miners act as free riders to them taking all the profits, with no incentive to keep the backbone operational other than to confirm transactions as the blockchain grows their is no incentive to have relay nodes, the miners get to much swing in the say, so in that sense miners are a bit evil in maximizing their profits at the expense of everyone else.

https://news.bitcoin.com/full-bitcoin-nodes-get-rewarded-like-miners/
https://aakilfernandes.github.io/soft-forks-vs-hard-forks

This is indeed a sad news to all of us. Is this is a call for more miners? Is this the reason why so many unconfirmed bitcoin transaction and very high transaction fee? In my case, I am expecting a bitcoin payment from freelancing, which is still unconfirmed for almost a week now.

Bitcoins price is getting higher and higher everyday and it has caused some huge users to invest in bitcoin. Those users has made a huge demand for bitcoin and in due to this a huge transaction traffic in great volume has flooded the network. Due to this the miners are asking for additional fees so they can make their services much more faster but it will bring burden to their machines and will cost a lot of power. Without additional fees our transactions will more likely reach a week before it will be confirmed.

Well, there is a difference between having mining nodes just keeping our network 'ticking along' vs strong security. 

I really don't understand why you think miners are evil -- they are participating in the network exactly as
Satoshi envisioned by rationally competing for the rewards.

Someone will end up hard-forking Bitcoin in the long run if we look at private keys and slow transactions becoming a strong enough motivation to justify it and we might well end up with two competing Bitcoin chains one with the micro-lending and increased block size and protocol changes for daily use but surviving as a brother/sister pair, the other being the traditional client.
 
There is enough demand to sustain both chains at this point with a few changes so I'm on the side of this will either be resolved internally or forced to the breaking point and we move to two chains and competing dev teams.  One can see there is a strong enough base of support to not be choked by the cap to force a fork, (Basically the we are choking all the air out of Bitcoin development and growth if we follow this route through and make it so only the rich can send Bitcoin at a decent speed as services will be forced to pay higher fees and this will impact users as well, aka pay $2 to verify a $30 dollar meal at a restaurant in 3 confirms) While the retainers of the original size being the other half and non budging so compromise is a puzzle.

Case in Point withdrew 0.05 BTC from Betmoose with a standard microbit fee to put in an exchange and its been in the transit line for a day
https://blockchain.info/address/1PKG3V2aq7ppdFc8UHa5gekmjrJU4NjXQx
One example choking commerce and activity since I can't request for a higher fee per-se although I am requesting the option for next time.

Block subsidy will be offset by price appreciation in all likelihood if we remain one chain a nickel at $500 is a dime at $1000 and a dollar at $10,000 but block rewards are also worth more. (Miners will be forced to Equilibrium) China might like small nodes while the West likes big ones so there will be variations in the price but at this point two similar chains is looking more like a possibility.
One could argue alt-coins do serve the same role for small lending but if vendors only accept Bitcoin others will argue that two-chain keeps the consistency of Bitcoin.

Competing chains such as  Ethereum and Ethereum Classic do demonstrate that after forks successful splits are possible. That said I find it amusing that Classic wants to make a fixed limit to ether in order to increase long term value even as we worry about block subsidy although Block Size is not even in their cards of concern.
http://www.coindesk.com/beyond-immutability-ethereum-classic-maps-way-forward/

I see your point perfectly

And I specifically addressed it in my previous post. Basically, I assert that no mining fees would be the lesser of two evils while you claim that it is the worst case scenario. The bigger evil for Bitcoin (or worse case scenario if you please) would be if Bitcoin drops from usage completely. But I wouldn't raise this issue if it was only that (since this is essentially an end point for Bitcoin, nothing to discuss). Your basic premise (or "small block" advocates) that fees are required to economically support the miners seems to be skewed (obviously, I mean the case when there are no more mining rewards). Fees are not required, and even if there were no fees altogether (and no rewards either), there would still be enough mining nodes to support the Bitcoin infrastructure ticking just for the sake of its further operation. That's why miners as they are today are evil. In other words, they receive a bigger portion of the pie than they deserve, and this is primarily thanks to severe monopolization (or rather olygopolization) of mining as such

That's is one of the disadvantages of bitcoin transaction fee's extremely getting higher, which is the number one will get affect on it is we the bitcoin enthusiast who always do transaction into the blockchain.

No, my point wasn't about a scenario in which people stop bitcoin.

The point is this:

One of the main arguments that the "small block proponents" advocate is that eventually the issuance of new Bitcoins to the miners that solve the blocks will dwindle, leaving only transaction fees to economically support the miners who are providing security for the network.

While that is true, there are many unknowns about the future, including transaction volume, the effectiveness of a fee market based on propogation times,   what kind of fee structures could support  the network, how much security is needed, advances in technology and paradigms, and other unknown factors. 

It will be decades before these concerns become pressing and it is best to allow bitcoin to grow organically right now, rather than restrict its transaction capacity.

These are the extremities, and none of which is good

The worst case scenario would be if no one continues to use Bitcoin directly, I mean sending and receiving bitcoins through the blockchain. If the mining reward eventually goes down to zero (due to halvings) and people stop transacting (e.g. due to hefty fees) the effect will be the same as if there were no fees altogether. On the other hand, if there are no fees but a lot of people are still making such transactions, I guess there will be enough miners confirming transactions totally free of charge just to keep the Bitcoin network ticking (if that was your point, of course)

Well... either increase the number of transactions you make or the amount of bitcoin you send, otherwise bear off the half dollar fee of bitcoin quietly!

The problem in this approach would be not all people have multiple transaction.  One example is myself.  I only transact one transaction at a time.  I do not have business or whatever that need to send lots of transaction daily.  So I cannot get any kind of discount here since I need to pay the whole transaction fee with just a single receiver in a transaction.

That quote depends on SPV wallets using fraud proofs to prevent miners breaking the consensus rules (i.e. what Satoshi really said). Everyone, including Satoshi and big blockers like Andresen and Hearn, have long since realised this cannot be achieved technically.

So try to provide us with information that's not more than 5 years out of date, please

You seem to be missing the point.  Worst case scenario for security is that there are ZERO fees,
which will not matter for decades since mining rewards are substantial and will
take several halvings to erode, even in the face of minimal bitcoin value appreciation.
In other words, lets say there's zero fees, and bitcoins remain at $1200.   After
4 more halvings, this still represents $135,000/day in security and the next drop
after that won't be until 19 years from now.


I believe he did, as evidenced in this quote:

It's now about 8 years since Bitcoin was released.  Nothing I read in the white-paper said anything about 'several decades'.  At least not that I remember.  At $1200/BTC it seems logical that we would start to see transaction fees become noticeable.

I don't know Greg so I cannot speak for him.  From what I do see in casual observation, the direction he and some of the other core team members are focusing on are exactly what I would do if I wanted Bitcoin to survive and thrive, particularly considering the complexities in forking.  It is for this reason more than anything that I have confidence in the trajectory of the solution and why I don't dump.


Mining is a sore point in the solution.  My guess is that Satoshi did not properly foresee the evolution of this segment of the solution.  This is understandable.  When I first analyzed Bitcoin I did not put much focus on it.  The reason is that as long as a broad segment of the ecosystem can property validate transactions, miners don't have a lot of latitude to 'cheat'.

I suspect that Satoshi did not completely forsee the economies of scale for mining (which is now tied to hardware manufacture) and the pressure that the formed entities would have over evolution of the rest of the system.  Not that he could not have, but he had a lot of other things to think about and most of them were more interesting.

Anyway, from my perspective, bloating the system will only make it so that there will be fewer opportunities to validate and will force other aspects of the system into the same place we find ourselves today wrt mining.  At that point whitelisting/blacklisting will be feasible.

Once someone is sitting on $10,000,000 worth of hardware necessary to play a part in Bitcoin operation, I don't see them NOT doing what the political leadership in their jurisdiction wishes.  The alternative in, say, China could be not only to lose your $10M worth of hardware but to have your organs harvested.

---

Looks to me as though segwit seeks to optimize the validation options to align with different classes of need and capability.  Once that is proven it will be practical to safely and efficiently edge up the system capacity trying to make sure that some of the concerns of excessive bloat don't become an issue.  This is not at all trivial and I have a lot of respect for those who attempt it.  As long as things are open-source the proposition that Maxwell-n-co are attempting a 'corporate monopolization' or whatever is, in my mind, a weak one.

Yeah, Transaction fees are really spiking and also the confirmation takes a bit longer to wait. That is why other people are now hesitating in choosing bitcoin just like my friends because they think that bitcoin fess will go even higher and the network will be even slower but i already tried to explain them and i'm also hoping for this kind of problem to minimize by the amazing teams behind bitcoin.