Question on Bitcoin transaction fees \ stacker news ~bitcoin

931 sats \ 12 comments \ @Signal312 7 Nov 2023 bitcoin

The high priority transaction fee now, according to mempool.space, is 97 sats/vB. That's very expensive, I believe it was just a few weeks ago, maybe a month, it was at 2 sats/vB.

Is this really just a measure of how much demand there is, for transactions, in addition to how much mining is taking place? Is there anything else happening? Seems odd that it changes so much, so quickly.

Also if you look here - https://bitinfocharts.com/comparison/bitcoin-transactionfees.html#1y - there's some huge spikes. One particularly on May 8. Are these spikes caused by anything other than the regular causes?

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2240 sats \ 3 replies \ @Murch 7 Nov 2023

Yes, this is just demand for blockspace driving up the price. Some of this demand stems from inscription transactions, in particular BRC20 transactions. The BRC20 activity increased recently again. Other than that, one issue that exacerbates the situation that blockspace production is essentially fixed, so whenever blockspace demand exceeds production, the users that are aiming for prompt confirmation tend to get into bidding wars which can quickly drive up the feerate.

I’ve written a bit more about the general subject on Bitcoin Stack Exchange: Can you explain some of the dynamics that drive the variations in mempool depth?

21 sats \ 0 replies \ @senf 7 Nov 2023

A lot of those people aiming for prompt confirmation don't actually need it, either. More people should set lower fees and wait.

21 sats \ 1 reply \ @Signal312 OP 7 Nov 2023

Thanks for the details. Great post on the stack exchange.

0 sats \ 0 replies \ @Murch 7 Nov 2023

Thanks!

114 sats \ 4 replies \ @tomlaies 7 Nov 2023

Yes, it's just demand and supply.

But a more interesting question could be what causes the spikes in demand. It seems to often coincide with rises in the exchange rate with the Dollar.

0 sats \ 0 replies \ @Zepasta 7 Nov 2023

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0 sats \ 2 replies \ @03365d6a53 7 Nov 2023

I'm also curious about likely macro triggers for the recent uptick in blockspace demand

0 sats \ 1 reply \ @tomlaies 7 Nov 2023

Sounds like you want me or someone to say something to the effect of "The fed is soon to drop rates and people are already moving into Bitcoin to anticipate a risk of a second wave of Dollar devaluation".

Is that true, do you want me or someone to say that?

Sounds like it could be true but we have zero tangible evidence for that. The simple observations like it often coinciding/trailing with Bitcoin going up in relation to the Dollar however is pretty tangible.

Or do you want to hear about Ordinals/jpegs being another thing on the demand side creating upward pressure?

0 sats \ 0 replies \ @03365d6a53 7 Nov 2023

demand for bitcoin doesn't necessarily translate to demand for blockspace

most purchases are custodial

I guess I'm looking for evidence / some kind of well-reasoned report, rather than the opinion of some guy from the internet 😀

Not that it matters much, rising fees is a healthy thing, but it is curious. Why now?

Users moving en-masse to/from cold storage following recent price increases?

large scale lightning force closes?

increase in mixing activity?

is probably a mix of things.. presumably some of this can be objectively analysed

the american fed / us dollar doesn't seem relevant tbh

7 sats \ 0 replies \ @swmtr 7 Nov 2023

tick tock

0 sats \ 0 replies \ @OT 8 Nov 2023

I'd say its bidding demand against block time.

0 sats \ 0 replies \ @03393ec3a3 8 Nov 2023

The spike coincides with the ORDI BRC-20 listing on Binance. ORDI price mooned pretty hard upon listing, so all the gamblers are rushing to/from the casino, as it were.