{"id":102482,"date":"2020-11-01T13:48:00","date_gmt":"2020-11-01T10:48:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/transaction-fees-explained\/"},"modified":"2020-11-01T13:48:00","modified_gmt":"2020-11-01T10:48:00","slug":"transaction-fees-explained","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/transaction-fees-explained\/","title":{"rendered":"#Transaction fees, explained"},"content":{"rendered":"

“#Transaction fees, explained<\/strong>”
\n<\/p>\n

\n

Usually, blockchains that can handle greater numbers of transactions per second have lower fees.<\/em><\/p>\n

Today, there are dozens of popular blockchain projects that charge different transaction fees. A simple rule of thumb is this: the higher the network\u2019s throughput, the lower the transaction fee.<\/p>\n

For example, the standard fee of a Ripple transaction is 0.00001 XRP as of today, and it peaked at over 0.40 XRP for a very short period in 2017. Considering that the price of XRP is below $0.25, the fee is negligible.<\/p>\n

On Ethereum, transaction fees are higher and can surge during congestion on the network. This happ<\/a>ened in 2017, 2018 and in mid-2020 during the DeFi craze. This August, fees hit an all-time high \u2014 and the record was broken again a month later. Some people were quoted fees of $99, prompting speculation that some protocols would begin to seek alternative blockchains. On Sep. 1, ETH miners pocketed profits of $500,000 in a single hour. Demand for transactions has become a big problem for this blockchain, but it\u2019s hoped that a long-awaited upgrade to Ethereum 2.0 will deliver a better fees system. Ethereum\u2019s co-founder, Vitalik Buterin, has expressed concerns that high fees could encourage selfish mining practices.<\/p>\n

As for Bitcoin, the largest cryptocurrency by market cap has also seen a considerable increase in the price of transaction fees this year. They were under $1 in July, surged above $6 in August, and breached $10 at the end of October.<\/p>\n

Besides Bitcoin and Ethereum, other blockchains \u2014 including Litecoin, Bitcoin Cash, Cardano and Ethereum Classic \u2014 have much lower fees of below one cent on average. Tron has even lower fees, similar to Ripple.<\/p>\n

Elsewhere,\u00a0ILCoin<\/a> also has infinitesimal transaction fees, and it relies on a PoW protocol inspired by Bitcoin. Each block on its blockchain can handle millions of transactions, as opposed to the 2,000 transactions that are included in a typical BTC block. This allows ILCoin to maintain unnoticeable fees \u2014 and the company says this comes to 0.0124 ILC for every 10 million transferred. Unlike Ripple, which is a more centralized payment network, ILCoin is decentralized and relies on the RIFT protocol.<\/p>\n<\/p><\/div>\n