Check use use fee rate for your Bitcoin transactions
Bitcoin transactions will be confimed by miners. You don’t control miner works and block confirmations but you can control fee rate of your transaction when you broadcast it on the network, into mempools. Then miners will pick transactions that are most profitable for them to confirm first.
Make sure you know how to check a relevant fee rate and get corresponding waiting time for a first confirmation. Most of services require from 1 to 3 confirmations to credit Bitcoin (from your deposit) to your account balance.
Let’s get started!
Transaction fee will be decided by
- Address format
- Transaction size (number of input, number of output, and address format, transaction type)
- Fee rate
With non custodial wallets, you can choose address format to use (should be Native Segwit, bech32 starts with bc1q), select number of input and output for your transactions, as well as pick a relevant fee rate to use.
First, you must have a non-custodial wallet, such as Bitcoin Core, Electrum etc.
Second, you must know where to check current statistics in mempool. We will share them to you today.
Johoe’s Bitcoin Mempool Statistics
The link is for last 24h, but you can choose the window time from either 2-hr to All.
There are different color bands on the chart. Each of them represent each fee rate band in mempool in satoshi/ vMb. When one Bitcoin block is confirmed, it will take a maximum of 1 Mb from tip of the mempool.
As you can see, total size of temporary waiting transactions in mempool is less than 3 vMb. Additionally, less than 1 vMb for waiting transactions with fee rates from 2 satoshis / vbyte to even 2000+ satoshis/ vbyte. What does it means?
It means that either you broadcast your transaction with fee rate at 2 satoshis/ vbyte or 2000+ satoshis/ vbyte, it will be confirmed in the next block.
Remember, mempool changes quickly so if you are in hurry, you can pick a little bit higher fee rate to use, but it should not be too expensive (you will overspend the fee to miners).
If you are curious to see history of mempool and transaction fee rate, let’s zoom out, select “All”.
The last time we have a serious high fee race when people were panic and had high demand to move their transactions is in May 2022. In general, you see some spiking periods on the chart but if you zoom in, you will see even size of mempool increases in such periods, fee rates of waiting transactions are much lower than years ago.
The significant adoption of Native Segwit recent months help to reduce transaction fee for Bitcoin users.
Note that it is only true if you are using a non custodial wallet. Exchanges don’t care about that and they always charge (over-charge) fee with your withdrawals.
Check it there: https://mempool.space/
You can use it in a same way. One of disadvantages are
- Color design looks worse than Johoe’s site. Colors are arbitrarily mixed between hot and cold colors. So it is hard for viewers to differentiate between expensive and cheap fee rates.
- You can not choose Window times if you want to look restrospectively
It is very simple to use, especially for newbies.
If you intend to broadcast your transaction with fee rate at 2 satoshi/ vbyte, just hovering a computer mouse on mempool chart at right side at a relevant band. As of writing, with 2 satoshis +/ vbyte fee rate, there is about 0.67 vMb in mempool. That means your transactions will very likely to be confirmed in next 1 block.
Other good features are:
- Recommended Optimum Fee
- Calculation for your transaction size (choose input, output, address format)
- Estimation for transaction fee
Let’s try it out and see how you can save fee with Native Segwit address.