Cryptocurrencies with fixed block sizes or limited transactions per block—like Bitcoin—require network fees to prioritize transactions. While we focus on Bitcoin here, similar fees apply across blockchain networks (e.g., Ethereum) to incentivize miners.
How Bitcoin Network Fees Work
The Basics
Network fees are payments to Bitcoin miners for validating transactions and adding them to the blockchain. These fees:
- Incentivize miners to process transactions.
- Prioritize transactions with higher fees (similar to Uber surge pricing).
Analogy: Think of blocks as airplane seats—limited supply means users "bid" for priority. Pay more for faster processing; pay less to wait.
When Fees Apply
1. Buying Cryptocurrency
At Easy Crypto:
- Fees are included in the purchase price (like supermarket pricing).
- Fixed per transaction—cost-effective for large orders (e.g., $20 fee applies equally to $20 and $2M transactions).
- View itemized fees via the Rate Info link during checkout.
Exception: Bitcoin purchases bundle transactions for efficiency, but fees still apply when selling.
2. Selling Cryptocurrency
- Follow your wallet’s recommended fee.
- Use "Speed Up Transaction" to increase fees if delays occur.
- Confirm whether fees are deducted from or added to the transaction amount.
Tools:
Smart Contracts & Volatility
Ethereum’s Gas Model
Fees vary by transaction complexity (e.g., smart contracts, ERC-20 tokens). Key terms:
- Gas Limit: Max you’ll pay.
- Gas Price: Cost per unit (in Gwei).
- Gas Used: Actual units consumed.
Market Impact: High volatility spikes fees due to increased demand (e.g., traders moving large positions).
FAQ
1. Why do fees fluctuate?
Supply/demand: More transactions = higher fees.
2. How can I reduce fees?
- Time transactions during low-demand periods.
- Use networks with lower base fees (e.g., Lightning for Bitcoin).
3. Are fees avoidable?
No—they’re essential for blockchain security and miner incentives.
4. Why are Ethereum fees higher than Bitcoin’s?
Smart contracts require more computational work.
5. What happens if I set a fee too low?
Transactions may stall until demand drops.
Invest smarter: Check real-time crypto prices with our live tracker.