Bitcoin Transaction Fees Should Not Exist Because Miners Are Already Getting Paid!
Some of you who pay attention to the cost of BTC transactions will probably notice that BTC wallets usually include a mining fee by default in order to determine the speed of the transactions taking place.
image by Ptrinh18
What this means is that a transaction that does not include a payment to miners can sit in mempool indefinitely.
Well, that sounds fair since the miners need incentive to mine, right?
WRONG!
Payments to the miners are built into BTC from the beginning since every block mined produces 25 new bitcoins!
These new BTC represent a source of inflation that everyone that holds BTC has to pay as their currency is devalued (even if it is currently offset as markets realize BTCs value).
As a group, we are now seeing miners not include transactions that don't include increasingly high mining fees. The miners can literally hold the entire bitcoin market hostage in order to get whatever fees they want. Those of us with even a little financial market literacy can see that this will play out in a way where supply and demand determine the price of the transaction fees.
But I say no. The miners are already getting paid and transaction fees from wallet to wallet shouldn't exist!
Now some will probably argue that this will make mining unprofitable and then the transactions will completely stop. And then I'll say, "No. It will just weed out the inefficient miners and cause mining rigs to become more efficient."
So who will join me by changing the settings in their wallets to provide no mining fee?
That is not really the issue the fee is there so you can put your transaction ahead of others a way to organize when it will take place. Only so many transactions can fit in each block that is being mined. Also at some point here blocks will no longer hold newly minted coins.
Bitcoins are still being provided from new blocks, so fees shouldn't be necessary now.
And the fees are not simply assigning a location in line for being mined since miners are now allowing transactions to sit indefinitely in the mempool. Because of this, the entire currency of bitcoin is made unstable because we can no longer accurately tell how long it will take for a transaction to occur.