1

What would happen if hypothetically, every bitcoin user decides in consensus with the rest of the world to stop paying transactions fees from now on. Miners will be forced to include transactions anyways in the blocks, because if they don't, bitcoin will become useless for most people, thus decreasing its value as a whole. The 25 BTC they would get from solving empty blocks will be close to zero in value.

So why miners can't be satisfied with just the coinbase earnings? no fees for users = more adoption = BTC value goes up.

Improve this question
1
  • 25 BTC? You're way behind, the reward is 12.5 BTC
    – abelenky
    Commented Oct 21, 2017 at 3:20

3 Answers 3

Reset to default
1

So why miners can't be satisfied with just the coinbase earnings? no fees for users = more adoption = BTC value goes up.

First of all, transaction fees is used as a mechanism in bitcoin to deter spam. If transactions can be made without paying transaction fees, then there is no cost to the user to create spam transactions that will eventually overwhelm the network. So, the inclusion of transaction fees is a necessity for network health.

Secondly, it is not necessarily true that "no fees for users = more adoption = BTC value goes up". Paypal incurs zero fees for friend to friend transactions, does everyone own a Paypal account? Would onboarding many users that do not pay transaction fees cause Paypal shares to rise? Probably not.

Finally, a fee market for bitcoin transactions is a good thing as miners need to be compensated for the work they contribute to generate blocks. As block subsidy tends to zero, the proportion of mining revenue derived from transaction fees must rise or at least reach an equilibrium where the mining revenue is equal to the security cost of securing the bitcoin blockchain.

Improve this answer
0

Bitcoin mining is becoming incredibly expensive in terms of hardware required. Fees are there to allow "common people" to become miners and earn something from it.
If everyone stopped paying transaction fees then a lot of miners wouldn't find it profitable anymore to mine, so they would stop.

The result?

Only rich and selected miners would have the possibility to mine, thus creating a centralized control system, defeating the entire puropse of bitcoin: being decentralized.

Improve this answer
3
  • Are "common people" still mining in the first place?
    – John Smith
    Commented Aug 21, 2017 at 21:28
  • 1
    Well by "common people" i meant someone who can afford to buy some decent ASIC but is so rich to own a mining farm
    – Ivano Donadi
    Commented Aug 22, 2017 at 7:54
  • As mining prices grow and grow, if fees don't grow proportionally only a very rich and selected group of folks will be able to profit from mining, and they will begin to impose their own rules and guess what the first would be? Higher fees.
    – Ivano Donadi
    Commented Aug 22, 2017 at 7:57
0

Miners will continue to mine, and they will get only the reward for mined block, right now it's 12.5BTC.

Take this mined block for example

https://blockchain.info/block/0000000000000000012cff88e530b319ef7fe7c795c78f2cfbd5e7ab487cfccd

Total transaction fees are 3.14 BTC (~25% of 12.5), I think even without the fees the miners will profit.

But there is problem for users, right now miners pick transactions to include in the block based on the fees, the higher the fee the better for the miner, with high fee you can get your payment confirmed in the next block, with 0 fee your payment can be left waiting for 2-3 weeks and declined.

Improve this answer
1
  • So if everybody stops paying transactions, being selective won't be an option anymore.
    – John Smith
    Commented Aug 21, 2017 at 21:20

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service and acknowledge you have read our privacy policy.

Not the answer you're looking for? Browse other questions tagged or ask your own question.