Why bitcoin transaction fee is high: simple explanation
On May 20th, 2020 the Bitcoin transaction fees have soared, reaching highs of $12.24. Incredibly high fee for a single bitcoin transaction. People who make transactions, but don’t have a deep understanding of bitcoin nature, have been confused and searched for reasons.
Let's start with the basics
Bitcoin is mined by miners and any miner is a transaction handler. They bear the costs of bitcoin mining (energy costs, cooling costs, cost of equipment) and get a commission for every transaction in the bitcoin network. Miners have the choice of which transactions to process first. Transactions with higher fees have a higher priority to be processed primarily.
What reasons impact to the transaction fee?
1. Mempool Size.
It’s the number of transactions in the Bitcoin network, which is being waited to be confirmed. A high mempool size indicates that a confirmation time of the transaction might be longer. And miners can choose which transaction to handle first from mempool. Read more about Mempool here.
2. Amount of BTC transaction fee.
It sounds confusing, but it’s true. Higher Bitcoin transaction fee you pay, the faster your transaction will be processed.
3. Bitcoin scalability problem.
It’s a limited rate at which the bitcoin network can process transactions. Bitcoin network can process 7 transactions per second (TPS) only. It limits the speed, amount, and sum of transactions. To give a frame of reference, Visa processes around 1700 TPS.
While Bitcoin offers immense benefits in terms of decentralization, security, and as a financial hedge, one can’t deny that it is undoubtedly slow.
Whether TrustDice casino takes transaction fees?
TrustDice platform doesn’t take any transaction fees. When a user makes withdrawals from the casino, the required amount of transaction is a pure amount of fees from the blockchain.
The fair transaction fee for bitcoin network can be checked on BTC.com in Fee Stats. You can check every day's correct transaction fee.
