Bit (money) The word bit is a colloquial expression referring to specific coins in various coinages across the world. Contents In the United States, the bit is equal to one eighth of a dollar or twelve 1 ⁄Two cents. In the U.S., the “bit” as a designation for money dates from the colonial period, when […]
Xapo Forwards Miner Fees to Users After a Grueling Two Weeks of Backlog
This week the bitcoin-based company Xapo has announced the rigid will no longer pay mining fees for customer transactions and will forward the cost to users. The announcement comes after a hectic week where over 150,000 to 200,000 unconfirmed transactions packed the network transaction queue (mempool).
Xapo Will Forward Miner Fees to Users
Customers of the cryptocurrency service Xapo have received emails from the company stating they will no longer pay customer mining fees. The company goes after a few other bitcoin startups such as Coinbase and Bitpay who have also ceased paying user’s transaction fees.
“In the next duo of days all Xapo users will begin to pay the miners fees themselves in order to send transactions out of Xapo,” explains the Palo Alto, California-based startup.
Due to the increase in transaction volume of the bitcoin network, we’d like to give our users some control over their transactions. That being said, Xapo will give you the capability to select which type of fee you’d like to pay.
Does the Significant Congestion and a Backlog That Won’t Clear Mean Mike Hearn Was Right?
The news goes after almost two weeks worth of backed up transactions packing the mempool. Presently, the backlog has over 200,000 unconfirmed transactions at the time of writing and has been this way for the past thirty six hours. Two weeks ago the transaction queue embarked to pack exponentially with over 150,000 transactions piling up and the traditional weekend lulls have done nothing to clear the backlog. In essence, the mempool seems to be growing without any ease in the near future unless a scaling solution shows up shortly.
Blockchain.info’s unconfirmed transaction count May 16.
Many bitcoin proponents are worried that Mike Hearn’s predictions two years ago this month may be coming true. The former bitcoin developer believed at some point a permanent backlog would begin to build up leading to crashing knots, people waiting days for transaction confirmations, and astronomically large fees.
“Bitcoin Core has no code in it to treat a permanent and growing transaction backlog,” explained Hearn in May of 2015. “Transactions just queue up in memory until the knot runs out.”
Tradeblock’s unconfirmed transaction count is a touch lower at 143,000 on May 17.
Bitcoin Proponents from Both Sides of the Debate Are Complaining About Rising Fees
So far lots of people have been waiting over six hours to three days for one confirmation and have been complaining across forums. Furthermore, fees are higher than ever as May sixteen exposes many people were paying upwards of $Two per transaction. Last week the average transaction cost for a normal 226KB tx was $1-1.50, and people still criticized wait times. People complaining about rising fees could be seen coming from both puny blockers and big blockers over the past week.
The news from Xapo is a disappointing reality for many bitcoin enthusiasts, but people understand that a business such as Xapo, Coinbase or Bitpay cannot feasibly cover the rising fees. Until the scaling debate is resolved, bitcoin network users will just have to deal with the current situation and with companies pivoting their business models. However, a resolution is nowhere near in glance.
What do you think about Xapo forwarding fees to customers? How do you feel about the current transaction backlog? Let us know in the comments below.
Pics via Shutterstock, Twitter, Xapo, Blockchain.info, and Tradeblock.
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