Can someone explain the satoshi fees?
So for example for average speed it might like 250 satoshi/byte.
What I’m confused about is the byte part. What constitutes as a byte?
So if I transferred say $100. Does each dollar count as a byte? I know satoshi is the smallest increments of bitcoin.
the bytes are controlled by how many times your source of bitcoin has been chopped into smaller pieces. It's cheaper to send money out of a big block than using a bunch of smaller blocks.
as an example I sent the same amount of money several times and have these stats
258 bytes - fee: 0.00001806 BTC (7 per byte) 6,922.15 exchange rate - fee ~$0.13 (1 hour 48 minutes to confirm, I could have paid less fee since I didn't need it that quick)
617 bytes - fee: 0.00004326 BTC (7 per byte) 5,222.83 exchange rate - fee ~$0.23 (>2 days to confirm, I should have paid more that time, I'm not comfortable with that sort of delay)
257 bytes - fee: 0.00010836 BTC (42 per byte) 4,599.10 exchange rate - fee ~$0.50 (4 hours to confirm, very nice time to confirm, felt good)
258 bytes - fee: 0.00018576 BTC (72 per byte) 4,331.68 exchange rate - fee ~$0.81 (20 minutes to confirm, definitely paid too much fee, could have waited longer on a lower fee)
Because I was sending a fixed amount of USD, the amount of BTC was going down as the price per coin went up. But even with a sizeable change in BTC value the transaction size didn't change.
just random luck that the 617 byte transaction came from a inefficient set of chunks of my bitcoin. All 4 of those transactions were for the same amount in usable delivered funds. The only difference in each transaction was the exchange rate and the fee rate. I chose lower and lower transaction rates as I got more comfortable reading about bitcoin and watching the fees at
Bitcoin Fees for Transactions | bitcoinfees.earn.com
Of course the downside is what happens if you guess too low and a transaction doesn't complete.
I have one in limbo right now that I tried 3 per byte. If I could go back in time I might have tried 5 instead. If I was sending the same transaction today I'd go back up to 42 per byte. Keep in mind that is a relative fee. 42 per byte with $10,000 BTC is roughly double 42 per byte at $5,000.
For the kind of transfer I'm doing I don't care if it takes hours but it'd be more comfortable if it was less than 24 hours.
Other people want to buy something in real time want the transaction to complete in seconds or minutes. To do that with BTC you'd have to pay much higher rates than I do. Something on the order of 150+ per byte.
Paying a low fee is a gamble, paying a fee too high is wasting money. And every time you send money you have to make that gamble one way or the other. And you will guess wrong (or be oblivious to the fees and let the software pick a higher number than is needed in most cases).
essentially the though process is
* Do I want to send funds
* Do I need it to go fast or can I let it be slow
* Set a fee rate to hopefully get the right speed
* Start a transaction
- (at this point you can see how many bytes it was, after you've committed)**
* Wait to see how long it takes
** If you want at that point or any time later you can do the math to see what your fees were compared to USD at the time.
As to how many dollars you can send in a byte, I don't think there is a fixed ratio. It just depends on how fragmented your BTC is.
Transaction fees - Bitcoin Wiki says a typical transaction is 500 bytes but I have no idea where they picked that number from.