Showing posts with label miners. Show all posts
Showing posts with label miners. Show all posts

November 28, 2017

How to calculate Bitcoin Transaction Fees when you’re in a hurry

By Kai Sedgwick - November 28, 2017 (news.bitcoin.com)


Calculating transaction fees is like riding a bike or rolling a cigarette: simple when you know how, but frustratingly complex otherwise. UX improvements over the last few years have made bitcoin easier than ever to send and receive, but fee calculation is still something of a dark art. The following resources make fee calculation a doddle.

Taking a Byte out of Your Satoshis


In this life, nothing comes for free. You wanna send bitcoin, you’ve got to pay the piper, namely the miners whose machines secure the network and confirm the hundreds of thousands of transactions that pass through it every day. Back in the day, when one bitcoin cost tens or hundreds of dollars, no one paid too much attention to fees; they were so small as to be unimportant, which is why sites like Satoshi Dice were able to flourish, permitting idle bitcoiners to send scores of micro-transactions over the blockchain with scant regard for fees.

Fee calculation isn’t as easy as the experts would have you think.


Where Do Transaction Fees Go?

The less blockchain congestion
there is, the faster your transaction
will be confirmed.
In addition to earning a reward for solving the next block, miners receive the fees attached to any transactions on that block. The current reward per block is 12.5 BTC, but the miner may receive a figure closer to 13 BTC by the time fees have been added on. Although there is technically no obligation to attach fees to a transaction, there is also no obligation for the miner to include any transaction in the block they’re confirming. Thus it makes sense to include a fee to incentivize the miner to add the transaction to the block.

Miners prioritize transactions with the highest fee per byte, which is why senders who are in a hurry will pay a surcharge to push their transaction to the front of the queue. Pay the highest possible fee and your transaction should be confirmed within the next block, which will take an average of between 5 and 15 minutes. Pay lower fees and your transaction should be confirmed within the next three blocks, which will generally take between 10 and 30 minutes.

Transaction Fees Made Easy


As bitcoin has risen, so have the corresponding fees (for reasons that aren’t always related to the price of BTC it should be noted). Who’s gonna pay for their skinny turmeric latte with bitcoin if the fee costs more than the coffee? Thankfully that’s not always the case; fees rise and fall, and there are ways to push through low-cost transactions. If you’re sending from a segwit address and aren’t in a hurry, fees of under $1 are achievable. Perhaps not ideal if you’re still chasing that coffee, but for medium to large transactions, still doable.

Search “how to calculate bitcoin fees” and you’ll be presented with mind-boggling explainers like the following:


Online explanations, while accurate, aren’t much use to the average layman.

Fee Calculation Without the Calculator


Turn to some of bitcoin’s more experienced heads for fee advice, and you may emerge with more questions than answers. “What do you mean you don’t know how to calculate transaction fees? It’s simple: all you gotta do is work out the size of your transaction in bytes, multiply it by the median byte size, take the answer in satoshis, divide it by 100 million (or 1e8 on a scientific calculator), get the answer in bitcoin and then convert to USD. Piece of cake.”


Thankfully there’s an easier way. Many hardware and web-based bitcoin wallets already come with built-in fee calculators which do a pretty good job. But not all wallets are similarly equipped, and the majority of sites, from cryptocurrency exchanges to deep web stores, still leave it to the customer to calculate fees. In such situations, the following tools are invaluable:

Estimatefee.com is a simple website that calculates the cost (in satoshis and USD) for a bitcoin transaction based on how much of hurry you are to move your coins from A to B. At the time of publication, fees are between $3 and $6 for sub-1-hour transactions.

Bitcoinfees.info displays slow/medium/fast fees in USD with no muss and no fuss.

Bitcoinfees.earn.com is another prediction tool, but you’ll need to be fluent in satoshis to grasp this one. For those who are still mystified by satoshis and what they mean in fiat terms, this satoshi to USD converter will come in handy.


It may seem frustrating that there isn’t a simpler way of determining fees, but due to the way bitcoin works, the price you pay depends on a number of factors including the size in kilobytes i.e the amount of data that makes up the transaction. That’s why segwit sends are generally cheaper: because you’re transmitting less data over the network. The blockchain is a bit like a highway in that it can get congested at peak times. If you’re not in a hurry, wait till the number of unconfirmed transactions in the mempool drops, taking the average transaction cost down with it.

If you’re new to bitcoin, fees can be fiendishly tricky to get your head around. Use an online fee estimator to do the math and leave the minutiae of satoshi per byte calculations to the experts or to your wallet’s built-in estimator.

Images courtesy of Shutterstock, and Satoshi Dice.

Kai Sedgwick

Kai's been assembling words for a living since 2009 and bought his first bitcoin at $19. It's long gone. He's previously written white papers for blockchain startups and is especially interested in P2P exchanges and DNMs.

November 17, 2017

Twist in the plans of SegWit2x, Possibility of a Hard Fork looms over

BY Bhushan Akolkar - November 17, 2017 (www.coinspeaker.com)


In a fresh new twist in the plans of SegWit2x hard fork, there is every possibility for the hard fork to go through in the near time.

The much-debated SegWit2x hard fork was being officially canceled last week after several community leaders and a large number of miners withdrew their support due to lack of consensus. As a result, the hard fork plans were completely halted which meant that Bitcoin will not be splitting into two, as projected earlier. However, just a few hours back, there has been the latest twist in this story as Director of Comms @ Coinbase, David Farmer took it to his Medium-blog that there are still a small group of miners who are attempting to go ahead with the hard fork.

Considering the possibility of network instability in such a case and in order to protect the customer’s funds, Coinbase is likely to suspend the buying/selling of Bitcoins 2 am Pacific Time on November 17th, an hour before the fork which is projected to occur between 6am to 8am Pacific Time on November 17th. Once the fork gets initiated and confirmed, all the normal operations will resume afterward. As per the latest information available on blockchain.info, the total number of blocks mined currently shows to 494743 and the SegWit2x is scheduled to take place at 494784 which is pretty close from the existing position.

Earlier this month, Bitcoin prices scaled to new highs above $7800 mark, but however soon after the announcement of the cancellation of SegWit2x, the prices corrected majorly for a week. Later, Bitcoin managed to regain its lost ground and currently, it trades convincingly close to and above $7800 in past 48 hours. Now, as per the most massive bitcoin exchange, Bitfinex, Bitcoin has crossed the $8000 to hit a new record high of $8040 and its latest price on the exchange shows to be $7837.55. Moreover, the word regarding the new twist in the plans of SegWit2x is yet to spread and we think and we think that there is every possibility we might see Bitcoin trading well above $8000 very soon.

In the meantime, just when the plans of cancellation of SegWit2x were announced, Bitcoins first derivate Bitcoin Cash was gaining the limelight as its prices rocketed to new highs above $1900 as a lot of miners shifted to the BCH blockchain.  Bitcoin has recently been hard forked to a new software upgrade in its Difficulty Adjustment Levels (DAA). Many believe that it has created a level playing field for mining activities between the BTC and BCH blockchains.

As the SegWit2x is approaching closer, we believe that there can possibly be a new fresh upward momentum to be seen in the Bitcoin prices. The SegWit2x is expected to improvise a lot of things on the scalability issues of Bitcoins.

Bitcoin adds $41 billion to market cap in 6 days as it hits all-time high of $7,998

By Arjun Kharpal - November 17, 2017 (www.cnbc.com)








  • Bitcoin hit a new record high Friday and was within touching distance of the $8,000 handle
  • Coinbase said that there was still a possibility of a planned Segwit2x upgrade happening that would cause bitcoin to split and create a new cryptocurrency
  • The possibility of the Segwit2x upgrade appeared to be the catalyst for the rally

Bitcoin hit a new record high Friday, coming within touching distance of the $8,000 handle.

The cryptocurrency was trading at $7,998.40 in the early hours, U.K. time, according to industry website CoinDesk. Bitcoin did pare some of those gains, however, falling as low as $7,535.85; it was trading around $7,750 by mid-morning.

It's been a wild week for bitcoin, which sold off heavily last weekend, falling to around $5,500. Since Sunday, the cryptocurrency has risen from that low to Friday's high, marking a 45 percent increase.

In that time, bitcoin's market capitalization, or the total value of the digital coins in circulation, has risen from $92 billion to $133.5 billion, according to Coinmarketcap.com.

The price dip last weekend came after an upgrade to the bitcoin network, SegWit2x, which was planned for November 16, was called off. The aim was to increase the transaction speeds of SegWit2x, which has increasingly slowed down over the years. If the upgrade took place, it would have caused what is known as a "hard fork," causing a new bitcoin spin-off to be formed.

Two previous forks have already happened earlier this year, leading to the creation of bitcoin cash and bitcoin gold.

But support for the Segwit2x upgrade waned, causing developers to call off its planned implementation.

This appeared to be the initial catalyst for the sell-off.


But on Friday, Coinbase, one of the world's largest cryptocurrency exchanges, said there is still a possibility of a fork.

David Farmer, director of communications at Coinbase, said on a blog post that a "small number of miners may attempt to go forward with a fork."

A miner is a key part of the bitcoin network. It is a person who runs a "node", or a high-powered computer that is able to solve the complex mathematical equitation required to verify bitcoin transactions.

If a large number of miners upgrade the software on their nodes, it could cause a fork. Farmer warned that this small number of miners still supporting the Segwit2x proposal could cause a fork.

If a fork happens, holders of bitcoin will receive the newly-created cryptocurrency called "bitcoin2x" for free, essentially giving them free money. That is why bitcoin rallied Friday.

Coinbase said that it will disable the function of sending and receiving bitcoin at 2 a.m. PT on Friday on its platform, and halt buying and selling an hour before the fork, which is forecast between 6 a.m. and 8 a.m. PT.

All functionality will be re-enabled shortly after, Farmer said.

The Coinbase communications executive said that there are two scenarios that could occur. The first is that the new bitcoin2x network is unusable because there is not enough support, in which case Coinbase will not facilitate trading or withdrawals because "it will not be possible to move these assets." Farmer said that this is the most likely outcome.

The second scenario is that the bitcoin2x network is usable because miner support is strong.

Bitcoin has had a rocky year but the price has continued to rise and is up around 700 percent. But many critics have thrown cold water on the rise of the cryptocurrency, with JPMorgan Chase CEO Jamie Dimon calling it a "fraud". Regulators in some countries have also cracked down on bitcoin trading, with China banning bitcoin exchanges.

October 21, 2017

Chinese miners sell hardware amidst regulatory uncertainties

By Samuel Haig - October 21, 2017 (news.bitcoin.com)


It has been reported that an increasing number of Chinese bitcoin miners are liquidating their hardware via second-hand trading platforms. Many of the miners are selling their equipment due to fears that China’s cryptocurrency crackdown may be intensified to target miners.

Many Listings for Undervalued Mining Hardware Have Emerged Following the Chinese Central Government’s Crackdown on Cryptocurrency Exchanges


One miner based in Wuhan is liquidating 50 motherboards at below market value via the Alibaba owned second-hand trading platform Xianyu. The listing stated the “boards were manufactured this June”, and have only been used “for two months”.

A Chinese miner has told reporters that he is selling his equipment in due to the looming threat Beijing may seek to further its crackdown on cryptocurrencies. The miner stated that he doesn’t “care about [the] bitcoin price anymore. There are too many regulat[ory] uncertainties. You know the government always adopts an interventionist approach in its economy. What if the authority one day suddenly announces that it’s illegal to hold coins? Now I just want to sell out all of my miners and ASICs. No more roller coasters in my life.”

Concerns pertaining to the threat of a Chinese crackdown on bitcoin mining are influencing the operations of industrial as well as retail mining entities. An anonymous source has alleged that Bitmain is transferring their mining operations overseas as a precautionary measure designed to evade any future regulatory hurdles that may arise in China.

Not Everyone in China Is Preparing for Regulators to Target Miners


A computer hardware retailer, Mr. Fu, told reporters that he is planning on stocking large quantities of GPUs and ASICs, expressing his expectation that the mining industry will continue to grow in future.

Chinese media outlet Caixin recently published an article that refutes the concerns pertaining to the Chinese government extending its cryptocurrency crackdown to target mining. The publication asserts that an anonymous source who is “close to regulators” have claimed the fears regarding a government attack on miners is “false.”

According to Caixin, an operator of a mining has stressed the benefits reaped by bitcoin mining to the Chinese economy as a deterrent against excessive regulatory interference. The source is cited as depicting bitcoin mining as a nascent boom export industry, stating that “domestic [miners]… mostly export to foreign countries, earn[ing] foreign [currency” that has “to come back into the yuan.”

Images courtesy of Shutterstock