The Bitcoin space is packed with disappointments and seems to be the major issue people discuss recently due to the increasing fees. The normal transaction fee has increased rapidly to $19 and this has turned bitcoin’s former assertion to prominence as an inexpensive online payment process into an absurd claim.
Despite these rising costs and the incessant debate that is ongoing, developers and buyers insist there are easy ways to minimize fees that are not being completely capitalized.
The debate was raised a while back when recently developed data emerged proposing that one crypto startup, Coinbase, solely facilitates half of every bitcoin transactions due to the fall in the whole network when the United States based exchanged disconnected for several hours on 11th of January.
As stated by critics, the issue with this scenario is the organization could save not only its customers but diverse companies’ users too by enforcing a couple high-tech characteristics like Segregated Witness (SegWit). As the change of code for SegWit was set in motion on bitcoin 5 months ago, a lot of people are displeased Coinbase is yet to implement it. The CEO of Bitrefill, Sergej Kotliar, labeled the novel data a “smoking gun” because it shows the magnitude of bitcoin’s insufficient transaction space Coinbase has used.
For Coinbase, consumers are running out of patience for they were very vocal when debating bitcoin’s block size. They complained about increased fees and argued that a rise in the block size figures would help lessen those expenses. Still, analyst argues that the company should not complain after all it has not done all it can to reduce fees.
In response, Brian Armstrong (Coinbase co-founder) went on Twitter to reiterate that the organization is making effort to introduce features to bring down fees; nonetheless, he stated that it is quite tasking.
What if users are no more interested in coping with the fees for trading, there are many effectual ways to abate them today.
SegWit was commended for the development that would aid bitcoin soar without increase the block size in 2017 scaling debates. Still, just 12% of the coins transactions utilized the technology, even if SegWit dealings cost half the usual transactions. Not every wallet presently has SegWit ability, however, hardware wallets like Ledger and Trezor agree with it.
Blockchain and Coinbase have accentuated that SegWit is an intricate change and users may lose funds if great errors occurred. As companies continue to support the new attribute, Bitcoin fees are going to decrease and many say that transaction fees will vanish if SegWit transactions replaced standard transactions. However, if fees are not removed, a more distinct kind of SegWit address is ongoing, which may help investors save more in time come.
Grouping a collection of lower transactions into a massive transaction is predominantly used during traditional payments; it has become more well-known for trading Bitcoin that aid payments.
If companies make use these characteristics appropriately, bitcoin fees may reduce by 80%. Batching can wear down privacy and is relatively slower, however, it solely depends on the way users or companies implements it.
In spite of these tradeoffs, Coinbase and other companies have said publicly that they aim to enforce batching to repress fees.
In order to stay abreast with the progress of the industry on receding fees, Bitrefill’s Kotliar inaugurated a device that lets users view how enhanced their transactions are, showcasing if the transaction made use of SegWit, batches or several other means shown to raise or reduce fees.
Looking further into time ahead, Bitcoin creators are processing several projects like the Lightning Network; this will be helpful in dropping transaction fees, regardless of an increase in the number of users making use of the network.