How Long Does a Bitcoin Transaction Take in 2018?

in bitcoin •  11 months ago

Bitcoin is facing an existential crisis. With transaction confirmation times averaging 1,570 minutes (one day, two hours and ten minutes) on January 28, 2018, and reaching an all-time high of 11,453 minutes (seven days, 23 hours and 53 minutes) just a week prior, it is becoming increasingly expensive to use bitcoin. While the average transaction fee of $9.82 at the time of the writing of this article reflects less than a fifth of the all-time high on December 12th, this still represents a substantial pseudo-tax for every bitcoin interaction or transfer. 

With every attempt to remedy this problem either being rejected or resulting in a hard fork and a new altcoin, bitcoin is increasingly being seen as being unsuitable to handle the demand it helped create. 

"Ultimately the lowest fees for a transaction wins and as cryptocurrencies attempt to unclog congestion in their blockchains the ones with the most innovative means and lower fees have an advantage in terms of speed and cost," Charles Hayter, chief executive of the altcoin comparison site Crypto Compare, told CNBC. "The problem in switching for actual payment now is a bit of a bet - the more established the crypto the more likely someone will accept it due to the lower volatility and conversion risk. A year ago a low percentage of people would accept Ethereum but now a lot more would."

Waiting...

Understanding the Problem

A 1,570 minutes confirmation time is problematic not only because it means it takes more than a day for a mined block to recognize a transaction, but because the current setup for the bitcoin network is that it requires six confirmations for a transaction to be considered legitimate. That would mean that one average transaction would take nearly a week to process. 

Transaction fees are fees awarded to miners as encouragement for producing a block. When a bitcoin transaction occurs, it is sent to the unconfirmed transactions pool. From there, miners can pick up transactions to process on the basis of the highest transaction fee going first. These transactions are recorded to the block the miner has discovered, the transaction returns to the queue if it has not received all six confirmations, and the process continues.

As a block only takes ten minutes on average to mine, a transaction ideally should be ten minutes total to process or less. As more transactions fill the pool, it takes longer to process them all. To get speedy processing, transactions must offer higher transaction fees. Per blockchain.info, the official public viewport to the bitcoin portal, the media confirmation time, despite an average time of 1,570 minutes, is 12 minutes. This can be read that the vast majority of bitcoin transactions are paying more than the average bitcoin transaction fee of $127 (as of January 28, 2018), which is logical considering the speculative nature of the current market. As buyers and sellers wishing to cash in on current ASK and BID prices, they would need to ensure that their transactions are processed first. 

This would also mean that those seeking to use bitcoin for non-market purposes, such as retail sales, can face wait times well in excess of a week.

When bitcoin started, the average transaction time was on par with mining times and the fee was only a few cents. The increase in transactions as speculation grew created a situation that was not anticipated when bitcoin was created. 

What Can You Do About This

While high congestion can be a factor in transaction times, proper management of your transaction fee setting can determine the speed of your transactions. It is advised that:

  • You use a wallet that allows you to manually adjust your transaction fee.
  • Adjust your transaction fee based on your bitcoin needs. If you can afford a longer confirmation, choose a lower transaction fee. If you are short-term trading bitcoin, however, opt for larger transaction fees.
  • Keep an eye on transaction times (average and median) and average transaction fees on blockchain.info.
  • Consider using a different altcoin than bitcoin for retail transactions. It is best to think of bitcoin as digital gold.
  • Consolidate your transactions as much as possible. Moving coins in and out of an exchange often can quickly grow expensive.

Be the first to know about what is going on in the bitcoin market. Sign up for the Bitcoin Market Journal investor newsletter today.

Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!
Sort Order:  

Yes it is big problem to bitcoin....

I see bitcoin like a store like a trust fund or swiss bank, I tried to buy something online last year from technology website, took so long the payment page timed out, yesterday just moving a lightcoin from wallet to exchange took 13 minutes. If Bitcoin is the safe, then whats going to be the everyday spend, for food and fuel? the fact Bitcoin is slow makes it great for saving and keeping safe.

Thank you for your nice post . .
I Voted U.
I am your Fan. . Im inspired by U..
Can U plz visit my blog and give me some tips?

I will be blessed if U follow me . . . #shunnoo

I always make helpful posts.

we're waiting the lightning network

As bitcoin grows older in the crypo world it becomes harder to mine. Would it be viable to mine bitcoin using junk pc? @bitcoin-journal

·

No. Mining is too difficult for an ordinary PC, much less a junk one. Look for other investments -- either other altcoins, or traditional stocks like NVDA that can profit from mining.

Some great and useful tips. I rather convert my BTC to ETH and then transfer it :)

·

Thats exactly what i do too. Its cheaper in the end to do it that way.
But i have begun to use Litecoin more now as the fees are very low and the speed of transactions are way more.

BTC is the biggest coin on the market, but the reality is that in 5 years it wont be anymore (or even earlier) its slow, takes high fees and is old...
That´s why we are seeing ETH growing at such a good pace, its the second most trusted currency and outperforms BTC at a level that can´t even be compared!

·

I dont see Bitcoin staying as strong as it currently is in the ext 60 days. And that is being generous. Bitcoin value is pretty much determined by the amount of volume its being traded. And now its obvious that that volume is reducing due to many know factors and FUD from governments. That being said, i think that it may not stay very valuable for long.

Eth has had some issues and its a bit of a risk itself to expect sustainability. There are foundational issues from developers.

I seem to have more faith in Litecoin. I may be wrong. But for now, thats what is working for me.

Good thing to remember that steem has free and instant transactions.

Congratulations @bitcoin-journal, this post is the sixth most rewarded post (based on pending payouts) in the last 12 hours written by a Newbie account holder (accounts that hold between 0.01 and 0.1 Mega Vests). The total number of posts by newbie account holders during this period was 4871 and the total pending payments to posts in this category was $7562.14. To see the full list of highest paid posts across all accounts categories, click here.

If you do not wish to receive these messages in future, please reply stop to this comment.

I think it's very good to invest with bitcoin but to store bitcoin it is a very careful choice to avoid loss

just like bitcoin we have many more crypto currencies and in future they also have much larger projects so after sometime it will take few sec

Thanks. LOOK My Blog and Follow CryptoNews24/7
Free Bitcoin Ethereum for my Followers every week!
https://steemit.com/free/@nakamotosatoshi/free-bitcoins-for-my-followers

For claim free bitcoin follow my blog !