- Bitcoin’s minimum transaction fee has dropped to 1/10th of a satoshi per vByte, the lowest level in years.
- Many blockchain blocks are now only partially full, showing a decrease in transaction fee revenue for miners.
- Recent changes by node and mining pool operators lowered minimum fee requirements by 90% from previous levels.
- Miners now receive just 0.6% of their income from transaction fees, with the rest coming from bitcoin block rewards.
- Experts warn that persistently low fees could threaten Bitcoin’s long-term network security as block rewards decrease over time.
Bitcoin node operators and mining pool managers recently agreed to lower the minimum transaction fee on the network to 1/10th of one satoshi per virtual byte (vByte), bringing fees to the lowest point seen in years. This shift is aimed at making the network cheaper and more accessible for users.
By early June, developers behind Bitcoin Core announced a significant change, reducing the minimum fee by 90% from the long-standing one satoshi per vByte. Blocks mined since this update now carry much lower average transaction fees, dropping from rates seen just one month earlier.
Recent activity shows that many bitcoin blocks are now only partially full. Even with the reduced fees, there is not enough demand for transactions to fill every available slot. According to mempool and fee charts from BuyBitcoinWorldwide, only 0.6% of miners’ total income now comes from user transaction fees. The vast majority—99.4%—comes from the block reward, which currently pays miners newly generated bitcoins with each block produced.
Many pro-spam arguments were about making miners more money. Now, in order to have earned slightly more in the short term by routing around the min TX relay filter, they’ve bottomed out the transaction fee market and are making consistently less from transaction fees as a…, posted a user tracking real-time fee data on X.com.
For most of Bitcoin’s history, developers set a default rule requiring a minimum one satoshi fee—this is 1/100 millionth of a bitcoin—for transactions to be processed and selected by miners. Recent policy changes also relaxed rules around the types and amount of data that can be stored on the blockchain, allowing more flexibility for commercial or non-monetary activities.
Supporters of these changes had hoped that reducing fees and opening up data storage would drive more activity and users to Bitcoin. However, transaction volumes have not significantly increased, while only transaction fee levels have dropped.
The block reward, or “coinbase reward,” halves every four years as part of Bitcoin’s design. As this automatic reduction continues over time, low transaction fees could create long-term risks for miners’ income and overall network security.
For more on data storage changes, see FixTheFilters: Bitcoin arguments go viral over relaxing Core data storage. You can also view current mempool stats at mempool.space.
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