Topic: What will happen to the transaction fee? - page 3. (Read 3113 times)

we should be thinking about moving the minimum fees down to 100sat/kb. when the fiat valuation rises.

but nah. core wants to push the fee war by introducing 0.0002 fall backs and then average fees etc
rather than letting transactions through and letting pools be instantly reactive to demand and open to decide,

so lets show a scenario where nodes AND pools used the "averaging" instead of reactive

in the future it wont matter what you set in your node. if someone else in the network had their relay fee set to "average" or say 0.00024. this will cause transactions to hop around the network of ethical nodes but then get dropped by the expensive node BEFORE even getting to a pool.

imagine there were 7 hops to reach a Pool from yoUr node, and each node in the relay set a different rate

U->0.00010->0.00012->0.00016->0.00018->0.00020->0.00022->0.00024->P

now imagine you have 1000tx of 0.00011 they get dropped here. and pool never sees it
now imagine you have 1000tx of 0.00019 they get dropped here. and pool never sees it
now imagine you have 1000tx of 0.00023 they get dropped here. and pool never sees it
now imagine you have 1000tx of 0.00024 they get through and pool sees it

whatever node has the highest rate between you and a pool becomes a gatekeeper, keeping cheap transactions from reaching the pool. forcing people to pay more just to be let past the gatekeeper to even be seen by the pool.
enforcing a fee war of a price rise just to be seen even during low demand.

also pools themselves wont just add any tx if demand was low not just because they are not even receiving tx's but also the "average fee" doesnt instantly react. but slowly reacts over a number of blocks. as they are no longer reactive to just add what they please, but now what gets added is based on an "averaging".

now continue imagining the pool only sees transactions over 0.00024(due to average previous demand). and an "average fee" of 3 hours (like 21.co uses) takes upto 18 blocks to bring the average down. meaning pools then makes empty blocks. until the average drops enough to see cheaper transactions

meaning if there were only 4000 sent in one 3 hours segment. where blocks allow 2500tx in per block
where the "average" network fee starts at 0.00024 due to previous demand

now imagine the 4000tx's vary in fee like this:
1000tx of 0.00011
1000tx of 0.00019
1000tx of 0.00023
1000tx of 0.00024

3000 would not even reach the pool straight away due to expensive relayers dropping the tx, treating it as third class citizens

it would look something like this:
block 450,000 - 1000tx (average already at 0.00024) <-the relay network only lets the 1000tx at 0.00024 to reach a pool
block 450,001 - 1000tx (average decreases to 0.00022667) <-the relay network only lets the 1000tx at 0.00023to reach a pool
block 450,002 - 0tx (average decreases to 0.00020148) <-the relay network hasnt let any tx to reach a pool
block 450,003 - 1000tx (average decreases to 0.00018889) <-the relay network only lets the 1000tx at 0.00019 to reach a pool
block 450,004 - 0tx (average decreases to 0.00016371) <-the relay network hasnt let any tx to reach a pool
block 450,005 - 0tx (average decreases to 0.00015111) <-the relay network hasnt let any tx to reach a pool
block 450,006 - 0tx (average decreases to 0.00013852) <-the relay network hasnt let any tx to reach a pool
block 450,007 - 0tx (average decreases to 0.00012593) <-the relay network hasnt let any tx to reach a pool
block 450,008 - 0tx (average decreases to 0.00013333) <-the relay network hasnt let any tx to reach a pool
block 450,009 - 0tx (average decreases to 0.00011334) <-the relay network hasnt let any tx to reach a pool
block 450,010 - 1000tx (average increases to 0.00010074) <-the relay network only lets the 1000tx at 0.00011 to reach a pool

but sticking with the "average" scenario.
ofcourse human emotion would see the 450,002 was empty so the 2000tx that got rejected for the 3rd time. would up their price to get into 450,003
block 450,003 - 2000tx (average decreases to 0.00018889) <-the relay network lets the 2000, >0.00019 tx to reach a pool
and bring the average over 0.00019000

however if pools were instantly reactive to demand. and the relay network was instantly reactive. instead of the stupid concept of averages.
in this low demand scenario all transactions would have been included in 2 blocks..
eg
block 450,000 - 2500tx - includes 1000 at 0.00024, includes 1000 at 0.00023, includes 500 at 0.00019,
block 450,001 - 1500tx - includes 500 at 0.00019, includes 1000 at 0.00011,

not 11 blocks with 7 blocks being empty if just left to wait for averages to drop, or 4 blocks if getting peed off to pay more due to emotional rejection and seeing an empty block

I think transaction fees are not too expensive, although will be increase up to 20k sat, and will there are different fees between bitcoin wallet service fees, for example Blockchain.info will has different fee with btc.com and the other bitcoins wallets services , so depend on what kinds of services wallet will be used.

yes i think its possible and actually i am not to confusing to think about the fee because for right now, the fee is still smallest fee that i can pay and beside i think that its fine to send some amount with that fee.



its depend on how people react about this, but if the demand is increase but the supply is reduce then it will make the price going to high. i don't know if in the future, people don't use bitcoin for some reason, maybe the price will be going down as you said. but me and especially people with using bitcoin don't want this to be happen, all we want is the price still going up.

I will start from the beginning, because in my opinion here is what we all want to know:

1 - Bitcoin price i growing
2 - Transaction fee is growing

How the he11 it is possible that with everything growing something can go down?

That is correct. The minimum transaction fee has fallen over the years in BTC terms.
What we are seeing now is a temporary blip, where the fees have increased due to limitations on block size.

Market may have an effect in transaction fee but I think it is safe to say that the said transaction since voluntary will be set to minimum if the price of bitcoin skyrocketed.  I'm sure everyone will try to set their transaction fee to be economically cheap and by that they will follow the default transaction fee.  which is as of now bitcoin wallet default tx fee  is 10 satoshi per byte.  But since competition is tight others tends to double even more it resulting to 30 -50 satoshi per byte for the optimum speed of confirmation.  

source : http://www.coindesk.com/new-service-finds-optimum-bitcoin-transaction-fee/


Probably the competition of being confirmed first will be the key of the increase of the tx fee in the future but I am sure senders will limit so they won't be spending too much just for the transaction fee.  But i think future upgrade will somehow fix this issue.
By the way transaction fee is not dollar base but instead it is based on the transaction's size.  So if the price of bitcoin gone higher so is the cost of the transaction fee in terms of USD.

Sorry, but i think that you make one basic mistake: transaction fee must grow in this condition of market. I dont see any other way. If you have any other option about market condition for next years, please, let as know..

If Bitcoin reaches $74,000 would it then be possible to send a small amount with a .000002 transaction fee? It should because why send $100 in Bitcoins with a $15 fee across the network. That would be stupid and "anti Bitcoin".

The price to reach such big value of 10k is not that easy as well if it reaches too there won't be much difference with the transaction fee. One can go upon one's own need. You may get delayed confirmation if you afford a reduced fee and get faster confirmation if high fee paid. Another thing based upon the amount to be transferred it might be differentiated with certain fee.

I dont think it will be higher that much , see we are growing the people who uses btc is increasingly in numbers now so there will be more that can be charge for transactions, there is a positive side that the more people who transacts in bitcoin the more that the ransacton fee uses to. It maybe enough.


Btc is increasing but im not hoping that transaction fee will that increase too. Only the btc please

Okay. Thanks, that helped. Since I must admit I didn't know one could actually send without fees.
Though you really should have included the link.
https://en.bitcoin.it/wiki/Transaction_fees
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Anyone tried this?

The transaction fee is going to remain relatively the same, assuming the community grows continuously and we see the block sizes grow to accommodate more transactions. If that can happen then we are going to be able to manage a ton of transactions in the span of a single block, and while upping the size of the blockchain it is also going to allow for the fees to be considerably lower.

Transaction fees are voluntary on the part of the person making the bitcoin transaction, as the person attempting to make a transaction can include any fee or none at all in the transaction.

A transaction was safe to send without fees if these conditions were met:

- It is smaller than 1,000 bytes.
- All outputs are 0.01 BTC or larger.
- Its priority is large enough

The transaction fee is processed by and received by the bitcoin miner. When a new bitcoin block is generated with a successful hash, the information for all of the transactions is included with the block and all transaction fees are collected by that user creating the block.

The transaction fee is therefore an incentive on the part of the bitcoin user to make sure that a particular transaction will get included into the next block which is generated.

How much fees we pay for a transaction?
Sometimes, it is not possible to give good estimates, or an estimate at all. Therefore, a fallback value can be set (default: `0.0002` BTC/kB).
Furthermore, Bitcoin Core will never create transactions smaller than the current minimum relay fee. Finally, a user can set the minimum fee rate for all transactions, which defaults to 1000 satoshis per kB.

True. The numbers do only take into account the rise in $ value and not the possible increase in traffic.

Anyhow, there really is no way to calculate accurately. Too many unknowns. (price,adoption,traffic,etc)
But I do agree with this.

Give or take a few.


 

Fees will necessarily adjust to what market would dictate. Your math may be correct, but it is just math and may not correlate well with reality. If 1 Bitcoin is worth $74,000, that would basically mean Bitcoin worldwide adoption. How many transactions per unit of time will the Bitcoin network process then? I guess many millions or even hundreds of millions daily compared to pathetic 250k transactions on average today. Further, what will the block size be then? Obviously, it should get increased multifold in order to fully accommodate this growth in the number of transactions. Thereby, there is hardly any reason to think that the fees will remain the same...

They should get down proportionately with the block size increase (i.e. the number of transactions that the block can accommodate)


I subscribe to every word of this

i think in the near future when the price will increase gradully then the fees with surly be lowered because no one will pay $10 or $15 to transact $1 or even $1000 thats like paying like old days and thats what banks do

These days you may need 70-90 satoshi/byte if you want your transaction get confirmed in less than 1h (~30min). And you can still send with 2000 satoshi / transaction, just it may take one day.
The volumes will rise and the top fees may get higher because of the competition.
That was my point, maybe first I was not clear enough...

Neither am I. But would that not be basing the value of the transaction on dollars?
As I understand it, it is usually calculated per bytes and in BTC. So if the price of bitcoin rises, so does the value of the tx fee.

Although I remember back in October 2014:
1 BTC = $350 and tx fees was around .0001 = $.04 , yet now
1 BTC = $740 while the tx fees has doubled at .0002 = $.15

So, I just keep seeing it go up. I do hope it doesn't double again.

Your review makes me think of the option of handling transactions in the future ..
Still, it seems to me that technically it will look different.

The transaction fee varies to the best of my understanding with the value of transactions fee. I have made transfers with different transaction fees and the last one I did was 9 cents in Btc I expect the transaction fee to move in the same rate with increase in price of bitcoin but not at the same rate because its miners fee and they are paid in Btc and not dollars.