pull down to refresh

Honest, passionate answer from the heart: because it's >0.999 sats.
But let's take the median of 5sat/vb to walk through it,
  • Opening a new channel is approx a 150 vB tx
  • A channel closure tx is around 200 vB
This means, assuming 1M sats personal lightning channels as the norm:
  • Paying 750 sats for opening a channel is 0.075% cost. That's great.
  • Paying 1k sats for closing a 1M sats lightning channel seems ok; it's 0.1% cost.
If the ante is 0.175% for channel ops, then this is not bad at all to gain "sovereign" LN access without a custodian. It also saves people from going to Liquid through Boltz, which is good (you only want to do that in emergencies.)
At the same time, I feel that if the peak is 1sat/vb, like it has been the past few weeks at times, that there isn't enough demand of meaningful txs. The only txs I would target sub-1sat fees for is consolidation, because these aren't urgent.
this territory is moderated
I appreciate the detailed response! Thinking through it in sat terms, I agree with the honest answer of your heart.
However, since most power is sold in fiat-denominated contracts, isn't it possible that we've been far over-paying for blockspace lately? (since 1 sat/vB was the minimum when the price of BTC was $10k and it was also the minimum when the price of BTC was $100k, the minimum price of blockspace in fiat terms increased quite a bit.)
Who knows where the exchange rate will settle, but perhaps the 1sat/vB minimum was actually keeping out meaningful transactions. 1 sat/vB is an arbitrary minimum, isn't it?
reply
102 sats \ 2 replies \ @optimism 18h
1sat/vb was intended as "no lower limit", if I remember the discussion at the time correctly. It just turned out that that wasn't the actual limit. The limit is (technically) 0 sats per tx, and if we take into account "no zero fee" policy, 1 sat per tx.
We can't translate it into dollars because bitcoin is dollar-agnostic.
reply
142 sats \ 1 reply \ @Scoresby OP 17h
I'm not sure I understand why you say bitcoin is dollar-agnostic.
If mining fees are only relevant insofar as they convince a miner to put the transaction in a block, and if miners have most expenses in denominated in fiat, 1sat/vB can provide more income for a miner in 2025 than in 2015 (of course, difficulty goes up too, but the increase of Bitcoin in fiat terms may or may not outpace difficulty increases). So at the least, mining isn't dollar agnostic.
But I suppose it's not the miners who are paying the fees. Any rise of Bitcoin in fiat terms affects fee as much as it affects the value of the sats being transacted. Which is your point that bitcoin is dollar-agnostic.
However, what I want to question is our feeling that >1sat/vB signifies demand for "meaningful transactions" while <1sat/vB does not (I may be misunderstanding your original comment, but it's a feeling I share in this form). Clearly, there is some level of fee rate that would be too high for anyone to meaningfully interact. I've certainly always assumed that 1sat/vB was well below this level, while maybe 10,000sats/vB gets near it. But This conversation is making me realize I've never thought about why I believed that. What if 1sat/vB is actually closer to the upper bound of reasonable fees than we previously believed?
reply
102 sats \ 0 replies \ @optimism 17h
Its hard to mine with bitcoin only liabilities because of the supply chain for miners and many forms of electricity and construction being fiat denominated.
However, that is still externalized. There is nothing preventing an end to end supply chain including electricity in sats other than "adoption".
I can't remember the time when you couldn't buy an antminer with sats, though I remember that the group buys early on were dollar denominated.
reply