Smart Fees Estimation
- 23 Jun, 2022
Have you ever wondered who processes the transactions made on
the Bitcoin or Ethereum networks?
Who is this entity processing transactions and why would they do
so? It is hard work.
The answer is simple. Miners process your transactions and they do it because get paid to so. Who is paying them? You...or anybody who is making a transaction.
How are you paying them? Each transaction on a public Blockchain requires the specification of the fees. But how is the amount of fees decided? The interesting nuance here is that the amount of fees to pay is based on an open market. You have the freedom to decide how much fees you want to pay for a transaction, however, keep in mind there is direct relationship between fees and transaction speed.
The more fees you are willing to pay the faster the transaction will be processed.
But here is the kicker. Its all relative....
Whether your fees are high or low are dependent on what other people are willing to pay for their fees. But what are other people willing to pay? To determine this you have to track the recent blocks in the Blockchain, extract the fees in those transactions, create a distribution of those fees and classify what is high and what is low.
You can try to do this yourself manually...every time you create a transaction. Or....you can boot up the Ronyn Wallet, navitage to the send page, click estimate fees and its all done.