Why Are Bitcoin Miner Fees So High?
The answer to the question “why are the fees so high” is a bit technical and some knowledge of how the bitcoin network works.
Transaction fees are related to two things:
Total network requirement for fees (how tight the network is)
– Number of entries in your transaction (size of the transaction)
Network Problem in Blockchain Raises Charges Competitively
The main reason why Bitcoin miner fees are high is supply and demand. Bitcoin block size is 1 MB, meaning that miners can only accept 1 MB of transaction per block (every ten minutes). If the number of transactions waiting to confirm exceeds the amount that can fit in 1 block, bitcoin miners prefer to confirm transactions with the highest bitcoin miner fees.
2017 is a good example of high miner’s fees. Throughout 2017, the number of bitcoin transactions that people performed every 10 minutes was able to exceed the 1 MB block size. As a result, miner’s fees rose.
Big Transactions Means More Cost
Usually, bitcoin transaction fees are directly proportional to the size of your transaction within the scope of bytes.
Sending a bitcoin transaction is the same as sending it by cargo. If you are sending something small, it is fast and low priced. However, if you are sending a large package, the shipment will take longer and be priced higher.
Similarly, bitcoin fees depend on the size of the transaction. Making more than one input increases your transaction. The number of inputs in a bitcoin transaction, for example, is like a single hundred dollar bill against 100 dollar bucks. In terms of a $ 100 transaction using a one hundred dollar bill, there will only be one input (one hundred dollar bill). There will also be 10,000 inputs for a $ 100 transaction using all the cents (one for each penny).
Bitcoin does not separate the value of each input. In order for the transaction to be valid, each input must be digitally signed. A certain amount of bytes (file space) is required to sign an input. Signing an input results in a small transaction size. Signing 10,000 inputs results in a large transaction size.
If your wallet has a balance of $ 70 and only $ 20 can be sent, your wallet balance consists of pennies and dimes, for example, instead of ten and twenty dollar bills. You’ll probably accumulate $ 70 on many small transactions rather than just a few large transactions.