The bitcoin network is currently fully congested with some 200,000 transactions stuck, unable to move, for the past 24 hours, sending fees skyrocketing with 21.co recommending $2-$3 per bitcoin transaction.
But that’s for only normal sized transaction. Bitcoin charges per byte as a measure of storage, with a common transaction of 400 bytes currently costing around $3, so if your transaction happens to be a bit bigger, say 4kb, then you have to pay $30.
That’s what the above bitcoiner had to do. For the privilege of moving $44, he had to pay $33 in fees, ending up with just $10 worth of bitcoin, making it probably the most expensive 4kbs in decades.
He could have waited to move them at a less busy time, but transaction backlogs now no longer clear even at weekends which may mean an increase in fees to the point where all of his $44 may have been eaten up, so hopefully he sent it to an exchange because that $10 might be soon stuck on the blockchain forever.
An easy solution to the problem is increasing capacity, something which, on principle, has consensus. But that consensus fully breaks down when specific solutions of how to increase capacity are raised.
So much so that, after now more than two years, with numerous proposals suggested, including a mixture of proposals, nothing has found any wide agreement, except for the Hong Kong agreement which was breached by the signing developers for they failed to pull request a maxblocksize increase.
So bitcoin continues to operate at a tiny 1MB capacity just as it has gone mainstream following numerous high publicized bitcoin related events, such as allegations that an aide to President Macron was using bitcoin or the recent global ransom attack which demanded payment in bitcoin.
All that publicity may have sent its price up, nearly doubling in the past few months, but at the same time its market share has fallen below 50% of the total market cap of all digital currencies, a drop of some 45% in just a few months.
That may be because bitcoin’s increasing fees and delays are pricing out many businesses and use cases which are now going to alternatives, such as ethereum, which has seen its price rise 10x in the past two months, rising far faster than bitcoin.