3 Reasons Why Bitcoin Transaction Fees Are so High
Cryptocurrency miners and traders received a negative surprise earlier this year, which was the fall in the price of coins on the stock exchange. Many of them were shocked by this situation, but there were also a group of people who were not surprised by this situation in the crypto market because they expected such an outcome.
But this is not the only problem that coin miners and traders have. There is another major problem that they have been facing for a long time. As for the price of coins, they believe that in a short time everything will return to normal and that the price of coins will rise in the future.
However, what bothers them the most are the costs they pay for the performed transactions. These fees are quite high, even now when the price of the original coin has dropped dramatically. The question is constantly asked why these fees remain so high, which influences them to start increasing or decreasing?
Bitcoin fans, as well as people who have invested in it, are looking for reasons why the costs of transactions are too high. So if you are part of this group of people, it would be great if you stay with us and read this article to the end. That way you will be able to find the answers to this frequently asked question.
When you pay something with your debit card, intermediaries are always involved in this payment process who is responsible for realizing the transaction. These intermediaries are the banks, ie the bank of the one who makes the transaction and the bank of the one who should receive the money. For these services, the intermediary, ie the bank, charges a certain amount of money to its clients.
In the world of virtual money, cryptocurrencies, there are no third parties when making transactions. When sending transactions, only the sender and the recipient are involved. However, these transactions have to be processed by computer and for these services, a minimal amount is charged to the users of the service. However, people complain that this fee is still not as small as everyone says.
So let’s see for what reasons, the cost to complete a transaction is huge:
1. Developments in the world
Just as some events happening in the world can affect the rise or fall of the exchange rate of the dollar, the euro, the yen, these events can have a huge impact on the cost of the transactions you make with cryptocurrencies. For example, if a country decides to ban bitcoin mining or trading, this could cause a change in the cost of transactions.
2. The network is busy
Blockchain fees can also change in cases where the network is overcrowded. New investors are emerging every day who are interested in investing in Bitcoin. For example now in this case when its price has fallen.
Now is the right time for traders to buy Bitcoin, as its price is drastically lower. And they will wait for the right moment when its price will rise to sell it and make a profit. In these cases, the transaction costs may increase or decrease.
3. The size of the transaction
As in the case of banks, the higher the amount of money you transfer from one account to another, the higher the commission you have to pay. The same rule applies to cryptocurrencies. The larger the transaction, the higher the blockchain fees you have to pay to make the same transaction.
The fluctuation of blockchain fees does not make those who invest in this sector very happy. Is there any way to reduce these costs? Of course yes, there are several ways.
– If you can afford to spend time, you can wait to make the transaction at times when the network is not too busy. For example, a weekend is an ideal time to make fewer blockchain transactions. Then the fees for it would be lower. But there is a problem and a risk that you need to be prepared to take. To be able to change the amount of the fee, you must use a wallet that will allow you to do so.
Because not all wallets have this option. And when it comes to risk, with small fees there is a possibility that the transaction will not be processed at all or may get stuck. Therefore, you need to be extremely careful.
– Use trading software that will give you some benefit. For example, there is software where you have to pay a fee when you create an account. However, the interesting thing about these channels is that, once you set up the account, the costs for future transactions are reduced.
Not only that, but at times when the network is busy, your transactions will take precedence. So try to find this software that will be able to offer you such benefits. However, this software is still in the experimental phase, and not all wallets support its use.
I hope that now it has become a little clearer to you what is hidden as a reason for the increase in transaction costs with Bitcoin. This has been a problem since the advent of cryptocurrencies, and there is no way to create a fixed fee to process Bitcoin transactions. There will be times in the future when this cost will decrease or increase, and you can not influence it in any way.
Although blockchain fees are still high, this should not stop you from taking the opportunity now that cryptocurrency prices have fallen and starting to invest in them. If you are wondering where to start investing in your future, we suggest you do so at bitcoineranew.com/de. Download the application and immediately create your account and immediately start trading cryptocurrencies.
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So do not procrastinate, do not waste time on trivial things, and immediately download the application and start investing in your future.