Bitcoin Core Fee, a Twitter account that provides regular information about bitcoin fee, has revealed that bitcoin transaction fees has touched a record low as only 1 satoshi, the smallest bitcoin unit, for every byte is required to process the next block. Not only that, it would only take less than 10 minutes to verify your bitcoin transaction.
According to Bitcoinist, they verified the news by sending $10,000 USD through Edge Wallet that enables traders to decide custom fees and they were able to get the transaction processed for a cent! That’s $0.01 for sending $10,000. Bitinfocharts.com reports that average bitcoin transaction charges during the last day were $1.23 which is the lowest amount since May 2017.
This is highly encouraging news and quite remarkable considering the fact that during last December when bitcoin price hit all time high of $19,400, Bitcoin blockchain was charging an average of whopping $55 for every transaction. One of the potential reasons behind the decline in transaction fee could be transaction batching by cryptocurrency brokers and exchanges which has also affected the volume of transactions.
High transaction charges have always been one of the criticisms of bitcoin and a major technological challenge negating any possibility of the cryptocurrency’s adoption as a regular digital currency. That’s why in August 2017, Segregated Witness or SegWit was introduced as an advanced scaling solution for bitcoin.
The technology revolves around optimizing the weight of the block hence reducing the transaction charges. Big name cryptocurrency exchanges such as Coinbase and Bitstamp have already integrated SegWit into their transactional systems to process a large number of transactions. This also provides exchanges with a competitive advantage as they can save traders a lot of money by processing a large volume at once.
The official website, segwit.party, reports that SegWit transactions are on a continuous increase and almost one third of all bitcoin transactions are employing the technology. Bitmain, the cryptocurrency mining giant, CEO, Jihan Wu said:
“You will find that the canonical block is less than 1MB but your tx fee is so high, after SegWit is activated. SegWit tx is unfairly cheap.”
Now, it remains to be seen whether this decrease is sustainable or not. Online shopping retailers have been wary of high volatility and unstable transaction charges in adopting bitcoin as a viable currency. If SegWit can permanently bring down the bitcoin transaction fee, it’s one of the major challenges that would have been addressed.