Misconception: Full blocks mean bitcoin is failing

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I keep seeing severe misconceptions here on Reddit and will try to set some of them straight.

Many people seem to believe that blocks should never be full and that full blocks mean that all transactions will be delayed, that bitcoin is failing, and that the sky will fall.

The simple answer is that this is not true, and I will try to explain why. The only effect of full blocks that cannot be avoided is that fees will be higher, but we may not be able to avoid higher fees in the long run anyway. We will, however, get very fast and cheap second-layer payment systems soon, which will relieve the main bitcoin blockchain of low-value everyday transactions.

So why will our transactions not be delayed when blocks are full? Not all transactions are delayed. Miners always take on the transactions with high fees. Only transactions with very low fees will be shunned by the miners, thus only these will get backlogged and delayed.

The simple advice is to pay an appropriate fee if you want to make sure that your transaction is processed without delay. Wallets should get better at fee estimation soon, as some wallets have caused problems recently by recommending too low fees. I expect these to be fixed quickly.

Why will we not have ever bigger backlogs, as the demand for bitcoin transactions increases? The answer is that higher fees reduce the number of transactions. It makes no sense to send 10 cents for a 30 cent fee, so with rising fees low-value transactions will not be made in the first place.

What if you have doubts and don't believe me? There is also a simple answer for that—just wait and see. Blocks are currently getting full. The number of full blocks is rising. No capacity increase will happen at least in the next few months, so you will see with your own eyes how bitcoin keeps working happily with only moderate backlogs that affect only low-fee, probably low-value transactions. The only not-so-nice thing you will also observe is rising fees and people complaining about these. But there are good reasons why fees cannot stay very low in the longer run on the main bitcoin blockchain.

Background information

A good fee estimator and fee statistics: https://bitcoinfees.21.co/

Johoe's Mempool Statistics: https://jochen-hoenicke.de/queue/24h.html

Interpreting Johoe's Mempool Statistics: https://redd.it/5ufwd0

submitted by /u/hgmichna
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Kryptous

Crypto Coins News - Ratings - Reviews

1 News - 247 News - 247 Bitcoin - 1 Search

BTC - BCH - ETH - LITE - XRP

Buy Sell Trade Crypto Here

 

Ticker

1 BTC = $59941.39 USD  (via Coinbase)
1 ETH = $2136.58 USD  (via Coinbase)
1 LTC = $242.76 USD  (via Coinbase)
Quotes delayed up to 2 minutes.

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