Author: Jared Lee Richardson 2017-03-30 20:51:45
Published on: 2017-03-30T20:51:45+00:00
There is an unbounded amount of demand for block space, and as such it doesn’t benefit anyone if the amount of free transactions get out of hand. The stable average value of the transaction fee determines what kind of business use-cases can be built using Bitcoin. An average fee of $0.001 usd enables a lot more use cases than $0.10 average fees, and $50.00 average fees still have far more possible use cases than a $1000 average fee. If fees stabilize low, use cases will spring up to fill the blockspace, unless miners arbitrarily seek to keep the fees above some level. A block so big that 100% of the transactions will always be mined in the next block will just cause a large section of people to no longer feel the need to pay fees. What we want is a true fee-market where the miner can decide to make a block smaller to get people to pay more fees, because if they were to go to 16MB blocks in one go, the cost of the miner would go up, but his reward based on fees will go down. Unfortunately, miners could arbitrarily decide to limit block sizes, and there's little except relay restrictions that everyone else could do about it.
Updated on: 2023-06-11T22:50:51.922624+00:00