The next release of Litecoin Core will lower network fees by a factor of 10, the development team behind the project announced on Friday, October 17.
— Litecoin.Com (@LitecoinDotCom) 19 October 2018
According to the blog post, the move comes in the wake of the 2017 run up in the price of Litecoin, when the transaction fees regularly reached up to and over $0.10 on average per transaction and peaking at just over $1.
“The average transaction fee as it stands on the network is Ł0.001 per KB or ~$0.05. With the announced changes that will soon become Ł0.0001 per KB or ~ $0.005, half a cent and back at 2015 levels,” the developers say.
Litecoin Core Lead Developer Adrian Gallagher elaborated on the move saying:
“To encourage more adoption and usage of Litecoin, I think lowering the fees are good thing. We’re not even close to block limits and the block size on disk is pretty small (20GB) relative to other coins. Technically people can already adjust their fees right now to the one above because of the more relaxed min relay/dust relay fee.”
Interestingly enough, he also says he doesn’t think “it will be too much longer before this bear market is over (3–6 months)”, and lowering the fees “will lay down the foundation for a fee rate which we can grow into proactively rather then re-actively.”
The blog post adds, that currently the fee market is not really a thing in Litecoin. The majority of money generated by miners comes from newly minted Litecoins which currently stands at 25 LTC (around $1,300) per block. The transaction fees on the other hand typically compromise around 0.05 LTC (around $2) per block, and as such lowering them should not prove to be an issue.
However, as inflation slows and dependancy on transaction fees increase in the decades to come, it will be interesting to see how this develops and whether the price and demand of Litecoin rise to match and offset the deflation of the asset.
Last month, Litecoin Core’s v.0.16.2 came out. That was a minor version release which included new features, various bug fixes and performance improvements, as well as updated translations.