How does the bitcoin mempool affect transaction fees?

1 answers

• stackyyApr 19, 2021 · 4 years ago
  The bitcoin mempool affects transaction fees by creating a supply and demand dynamic. When the mempool is full, there is a limited supply of block space, and users have to compete by offering higher fees to get their transactions included in the next block. This increased demand for block space drives up the transaction fees. Conversely, when the mempool is empty, there is more block space available, and users can get their transactions confirmed with lower fees. It's important for users to monitor the mempool and adjust their fees accordingly to optimize the balance between speed and cost. Additionally, it's worth noting that different exchanges may have different fee structures and policies, so users should consider these factors when choosing where to transact.
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