3 ms·

This is great. I think the downside, though, is the $0.04 transaction that incurs a $0.04 transaction fee. For instance, there's this transaction for .02 BTC t

by MCRed 12y ago

This is great. I think the downside, though, is the $0.04 transaction that incurs a $0.04 transaction fee. For instance, there's this transaction for .02 BTC that incurred a $0.19 fee. https://blockchain.info/tx/a2933a1dc53361a7770c2a9d998c1fe30165609717e820f82668839091a2fc94 https://blockchain.info/tx/a2933a1dc53361a7770c2a9d998c1fe30... I'm not sure why this tiny transaction cost so much more than the huge one, but being able to support 0.00045 BTC transactions at reasonable cost is the challenge. This isn't just a fee challenge, but a blockchain-bloat challenge as well. But if it can be solved, I think it would be a turning point for BTC.

williamcotton 12y ago
Transactions without fees will eventually be processed and normally within 24 hours in my experience. On top of that miners are currently processing transactions with fees of 1000 satoshis with no delay. That's about $0.004 with the current exchange.
- hobo_mark 12y ago
  Is this an artifact of current network dynamics or is it explicit in the protocol? In other words, can I, today, send zero-fee transactions and reasonably (99.99% of the time or something) expect them to be processed by some _known_ deadline? (Be it 24 hours or a week or whatever)
  - williamcotton 12y ago
    It is just current network dynamics. Confirmation times in general are unknown as blocks are produced on an arbitrary timescale that the software attempts to trend to a 10 minute average by actively changing the difficulty of the proof-of-work mechanism to match the entire hash power of the network. For transactions without fees there is no way to guarantee anything.
diego 12y ago
It's not that transactions "incur" a fee. You pay the fee you want, and miners prioritize transactions accordingly. Because transactions take up space in the block chain (and everyone's hard drives), small transactions are given less priority. Large transactions usually don't need to pay fees to be mined, small transactions may take a long time to be mined (or in the case of "dust" not be mined at all) unless you pay the recommended fee. https://en.bitcoin.it/wiki/Transaction_fees https://en.bitcoin.it/wiki/Transaction_fees
placeybordeaux 12y ago
Generally the very large transactions are even cheaper because transactions are prioritiezed based off of (BTC * time spent sitting)/bytes. It's a very regressive system, but is entirely about ensuring that 'dust' doesn't clog up the blockchain.
eugeneionesco 12y ago
I think this is a non-issue since you're not even able to make such small value transations with traditional banking tools.
- dllthomas 12y ago
  There was once optimism that bitcoin would allow easy micropayments. This seems to be an issue with that, though I believe it's one that has been long recognized by those actually doing much with bitcoin.
tinco 12y ago
I think because of the design of bitcoin $0.04 transactions are something they want to actively discourage. From what I understand of Bitcoin, the future will hold only large-scale transactions like this one, and as little sub-dollar transactions as possible. (because the network load of the system scales with the transaction quantity)
- saosebastiao 12y ago
  This, along with regulatory challenges, has hinted to me for at least a few years now that if bitcoin has any long term future at all, it will be as an exchange currency.
  - zanny 12y ago
    Its destiny is cryptogold where the store of value is in the security of sha256. In the future they will probably adopt new cryptography standards into the protocol as current encryption standards are broken down (ie, sha1 was used at first but you should not use it anymore due to its growing leakiness).
d23 12y ago
> But if it can be solved, I think it would be a turning point for BTC. Really? I find it hard to believe that the thing preventing widespread bitcoin adoption at the moment is transaction fees.

by MCRed 12y ago

williamcotton 12y ago

Transactions without fees will eventually be processed and normally within 24 hours in my experience. On top of that miners are currently processing transactions with fees of 1000 satoshis with no delay. That's about $0.004 with the current exchange.

hobo_mark 12y ago
Is this an artifact of current network dynamics or is it explicit in the protocol? In other words, can I, today, send zero-fee transactions and reasonably (99.99% of the time or something) expect them to be processed by some _known_ deadline? (Be it 24 hours or a week or whatever)
- williamcotton 12y ago
  It is just current network dynamics. Confirmation times in general are unknown as blocks are produced on an arbitrary timescale that the software attempts to trend to a 10 minute average by actively changing the difficulty of the proof-of-work mechanism to match the entire hash power of the network. For transactions without fees there is no way to guarantee anything.

diego 12y ago

It's not that transactions "incur" a fee. You pay the fee you want, and miners prioritize transactions accordingly. Because transactions take up space in the block chain (and everyone's hard drives), small transactions are given less priority. Large transactions usually don't need to pay fees to be mined, small transactions may take a long time to be mined (or in the case of "dust" not be mined at all) unless you pay the recommended fee. https://en.bitcoin.it/wiki/Transaction_fees https://en.bitcoin.it/wiki/Transaction_fees

placeybordeaux 12y ago

Generally the very large transactions are even cheaper because transactions are prioritiezed based off of (BTC * time spent sitting)/bytes. It's a very regressive system, but is entirely about ensuring that 'dust' doesn't clog up the blockchain.

eugeneionesco 12y ago

I think this is a non-issue since you're not even able to make such small value transations with traditional banking tools.

dllthomas 12y ago
There was once optimism that bitcoin would allow easy micropayments. This seems to be an issue with that, though I believe it's one that has been long recognized by those actually doing much with bitcoin.

tinco 12y ago

I think because of the design of bitcoin $0.04 transactions are something they want to actively discourage. From what I understand of Bitcoin, the future will hold only large-scale transactions like this one, and as little sub-dollar transactions as possible. (because the network load of the system scales with the transaction quantity)

saosebastiao 12y ago
This, along with regulatory challenges, has hinted to me for at least a few years now that if bitcoin has any long term future at all, it will be as an exchange currency.
- zanny 12y ago
  Its destiny is cryptogold where the store of value is in the security of sha256. In the future they will probably adopt new cryptography standards into the protocol as current encryption standards are broken down (ie, sha1 was used at first but you should not use it anymore due to its growing leakiness).

d23 12y ago

> But if it can be solved, I think it would be a turning point for BTC. Really? I find it hard to believe that the thing preventing widespread bitcoin adoption at the moment is transaction fees.