While bitcoin’s price is still struggling to find a comfortable range, the fundamentals of the cryptocurrency are looking really good at the moment. Transaction fees right now are the lowest for the past three months.
If you’re not in a hurry, it is currently possible to make transactions for less than 10 satoshis/byte, which would be considered unthinkable just a few weeks back. According to BTC.com estimation tool, the ideal fee right now would be around 127 satoshis/byte to get your transaction completed in the next few blocks. The number is a little higher than yesterday, where a fee of 40 satoshis/byte was presumably enough to get your transaction included in the next block.
The fee estimation tool from Coinb.in gives us a similar result: around 81 satoshis/byte. That means a transaction with a medium size of 226 bytes would cost around 0.00018306 BTC, or about $ 1.8 dollars. That’s a big improvement from an average transaction of $ 20 dollars just a few weeks back.
Why is it getting better?
There are three main reason that help explain the improved transaction fees and speed.
Spam attacks
The bitcoin spam attacks can be defined as transactions that send lots of tiny fractions of bitcoins to a lot of different output addresses. These types of transactions present a significant burden on the bitcoin network. It seems that whomever was originating these attacks is running out of steam.
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Transaction Batching
Simply put, batching is the process of grouping many smaller transactions into a single one in order to save on fees. It’s not a new procedure, but it’s only starting to become popular.
The fact that exchanges such as Coinbase (which is said to be responsible for about half of bitcoin transactions) are adopting batching certainly will have a tremendous positive impact on the network.
Segwit Adoption
SegWit adoption just broke a new record yesterday, hovering around 16% at the time of this writing. It is expected that transaction fees will continue to drop as more users gravitate towards using SegWit addresses.
While the fees are not low enough to justify paying your coffee with it, this is really good news for bitcoin.
There’s no guarantee that it's going to be sustained for the next weeks, but it could paint a really pretty picture if it does so. With Lightning Network in the works and already being tested, 2018 could be the year bitcoin goes parabolic.
Sage up,
*This is not investment advice by any means. You should do your own research before investing in bitcoin or any other cryptocurrencies.
Hi, how are you doing? I post regularly on subjects related to cryptocurrency and new tech. If you like my stuff and want to get it fresh off the keyboard, follow me @sek.
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I was unaware of the drop in fees, this is really good news (assuming that is stays where it is or continues to go lower).
Personally I'm okay with an middle-of-the-road transaction fee being about 1$; if it goes any higher then that then I start to hate it.
It sure is. I was hoping it could help the price pick up, but I guess I was wrong.