Transaction Fee

Mining fee, tx fee

1. | concept

Payment to miners as a reward for including a transaction in a block. As blocks fill up miners choose which transactions to include based on which will pay the highest transaction fees. For bitcoin to be usable as an everyday currency, it's vital that transaction fees are kept low.

1.1 | BTC December 2017

During the late 2017 bull run when everyone was buying cryptocurrencies the blocks for Bitcoin (BTC) and the mempool were full for weeks. This led to fees increasing to high levels where transactions could cost up to the equivalent of $50 USD to be confirmed quickly. These high fees aren't a problem for large value transactions, but they do damage the networks usability for everyday small transactions.

1.2 | BCH Stress Test

On September 1st, 2018, Bitcoin Cash (BCH) did a stress test to demonstrate the current scaling capabilities of the network and to uncover any issues. Throughout the day the Bitcoin Cash (BCH) network processed over 2.1 million transactions while keeping the transaction fees at 1 satoshi per byte, translating to an average transaction cost of around $0.001 USD, or one tenth of a cent.

* All terms and definitions will change as the Cryptionary improves