The US-based cryptocurrency holding has decided to cease paying bitcoin transaction fees on behalf of customers starting from 21 March. The policy aimed to support the network growth.
Coinbase users will pay fees only for transactions made in the blockchain. Dealings between user accounts will remain off-chain and free.
“We will discontinue paying network transaction fees for on-chain transactions starting March 21st, 2017. Network transaction fees do not go to Coinbase, they go to the miners of the Bitcoin and Ethereum networks,” Ankur Nandwani, product manager of Coinbase, wrote in the company’s blog. He explained that fees would be assigned dynamically based on current network conditions.
Moreover, Coinbase decided to drop some features and services, including payments in Bits (a unit of 0.000001 BTC), which was “rarely used and added confusion when sending and receiving bitcoin transactions.” The company will also disable SMS account access and user payment pages, whose functionality has been taken over by IOs and Android apps.
According to 21.co, bitcoin users paying a standard wallet fee between 1 and 20 satoshis per byte now need to wait between 4 and 131 blocks for their transactions to be confirmed, which means delays from 40 minutes to 23 hours. The minimum fee for a transaction to pass within an hour is currently set at 181-200 satoshis per byte.
For no-wait transactions, the minimum fee is 201 satoshis. Given that the average transaction size is 226 bytes, that fee would amount to 45,426 satoshis ($0.5559).
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