CoinTape predicts optimal Bitcoin transaction fees for users

Bitcoin users often run into this question: What is the optimal transaction fee for Bitcoin? A new Bitcoin service called Cointape can answer this question.

By analyzing the last three hours of data from the Bitcoin network, Cointape can predict the waiting time for users based on the transaction fee they provide, calculated in satoshis per byte. Cointape claims to be 90% confident in predicting the waiting time.

The default fee for many Bitcoin wallets is 10 satoshis per byte (0.0000001 BTC). However, Cointape claims that if users pay 20 satoshis per byte (0.0000002 BTC), transactions will be faster and less expensive.

For a typical Bitcoin transaction of 645 bytes, the fee is 129 bits (0.000129 BTC) (note, this is the size of the transaction, not its dollar value).

Cointapes lists the most popular transaction fees as 41–50 satoshis per byte, so a typical 619-byte transaction would ideally contain a 0.00024760 BTC fee.

Network competition

As the number of bitcoin transactions rises, competition for space in each block is heating up. Miners are ranked in descending order of transaction fees until the block reaches its limit of 750,000 bytes.

Transactions that have not been confirmed are stored in the miner's "memory pool", which is a bit like Bitcoin's "hell". They are then included in future blocks based on the priority of their transaction fees.

Currently, users can choose to avoid transaction fees. However, recently people have been discussing whether transaction fees should be increased. Core developer Luke JR also proposed to increase the minimum transaction fee to 10,000 satoshi to reduce spam transactions on the network, but the request was not merged into the mainline code.

Cointape points out that if users do not pay the fee, it may cause a delay in the transaction, which may require six blocks of confirmation or wait for about an hour (about one block is produced every 10 minutes).