Bitcoin Blocks and Fees

Bitcoin at it’s simplest is a ledger keeping track of transactions. On average every 10 minutes a new “block” of transactions is validated. Using this link you can watch as transactions are added to the next block. I think it’s truly mesmerizing. I think it needs to be made into an easy to watch app or screen saver (hint to someone). It is essentially watching each bitcoin block be organized. Transactions are added to the block and finally confirmed.

There is a lot of interesting data in each bitcoin block. 

Bitcoin miners validate a new block on average ever 10 minutes. Each block confirms the transactions that have happened in that time. Money sent from person X to person Y. 

You can also learn how much is paid in block rewards (currently 6.25 BTC every block) and in block fees. 

It does cost money to send your bitcoin from your wallet to someone else. You might think that’s bad since you can send money via your bank account to people now and “not pay a fee”.

But that is where you are wrong. Banks have tons of fees, from monthly fees to the “fee” of paying you 0% interest. 

Every time you swipe a credit card you are paying approximately a 3% fee. The price is just baked into the price of whatever you are buying as sellers assume you will be using a credit card at this point. 

Here’s all the data from a specific completed block. 

Block 767418

A total of 12,419.79 BTC ($222,022,574) were sent in the block with the average transaction being 4.4515 BTC ($79,577.28). ViaBTC (the miner who solved the block) earned a total reward of 6.25 BTC $111,728. The reward consisted of a base reward of 6.25 BTC $111,728 with an additional 0.1489 BTC ($2,661.81) reward paid as fees of the 2,790 transactions which were included in the block.

6.3989/12,419.79 = 0.000515 *100 = 0.05% of the value of the money sent was used to pay fees. 

As you can see the total of 12419.79 BTC were sent during that 10 minutes worth $222 million dollars. Users were charged 0.1489 BTC which comes out to a 0.0012%! That is insanely low.

If you were paying that percentage to send $100 it would be $0.001 dollars. 1/10 of 1 penny!

If you compare this to a credit card transaction at 3% that would cost you $3 vs $0.001 for a transaction. Imagine if everything we did got 3% cheaper overnight? Why haven’t more sellers adopted BTC?

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