Transaction Fee

Whenever you send bitcoin, you need to include a transaction fee. This fee goes to miners, who prioritize which transactions get added to the blockchain. Since there’s a limit to how much data can fit in each block (currently 4MB), miners prefer transactions that pay a higher fee per byte—known as the fee rate—rather than just those with the highest total fee. That’s why most wallets show fees in sats per vByte.

Bitcoin fees aren’t fixed; they change depending on how busy the network is. Paying a higher fee will usually get your transaction confirmed more quickly. If you’re not in a hurry, you can opt for a lower fee and your transaction will simply wait longer for inclusion.

As more people use the Bitcoin network, fees are expected to rise. To keep costs down, you can combine (consolidate) smaller UTXOs, batch multiple payments into one transaction, or use features like SegWit, which reduce the size and cost of transactions.