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Transaction fees are also paid to miners, and transaction volume pushes fees up. This is entirely by design. Satoshi's original Bitcoin whitepaper reads: "Once
by codewiz 5y ago
Transaction fees are also paid to miners, and transaction volume pushes fees up.
This is entirely by design. Satoshi's original Bitcoin whitepaper reads: "Once a predetermined number of coins have entered circulation, the incentive can transition entirely to transaction fees and be completely inflation free."
- sneak 5y agoYes, but transaction volume is essentially fixed at this point.
- codewiz 5y agoI misspoke: transaction demand pushes fees up.
- sneak 5y agoI could be wrong, but I bet we've already seen within half an order of magnitude peak btc transaction demand. Between competition (for example, we are just scratching the surface of eth tx demand, and high throughput competitors are out now) and L2 (ifwhen it ever delivers), I just can't ever see btc block bandwidth being priced 10x its previous peaks.
- codewiz 5y agoTransaction volume might also increase slightly with a number of planned improvements: https://bitcoinmagazine.com/technical/taproot-coming-what-it-and-how-it-will-benefit-bitcoin https://bitcoinmagazine.com/technical/taproot-coming-what-it... The Taproot upgrade is already in the process of being rolled out to the Bitcoin mainnet with a soft fork: https://taprootactivation.com/ https://taprootactivation.com/ Arguably, the Bitcoin scalability efforts have been progressing too slowly. Second generation blockchain designs such as Ethereum and Avalanche are going to dethrone Bitcoin at some point.