How The Bitcoin Transaction Fee Relates To Network Confirmations

One of the issues a lot of people have with the Bitcoin ecosystem is how they have to wait for transaction confirmations by the network. As most people are well aware, this can take anywhere from minutes to hours before a transaction gets the full six confirmations. But some companies are adapting their strategy, and Betcoin is looking to base the network confirmations needed for the transaction fee paid by the sender.

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Lower Transaction Fee Means A Longer Wait Period

People who have been keeping an eye on their outgoing Bitcoin transactions may have noticed how there is a specific fee associated with each transfer. In most cases, this fee will be the standard value of 0.0001 BTC, regardless of how big the amount wass they initially moved.

But when someone sends a much smaller Bitcoin payment, the transaction fee is less than 0.0001 BTC. It only seems to make sense for companies dealing with fractional amounts of Bitcoin to wait for more network confirmations on small deposits, whereas higher value transfers would only need one or two conformations, for example.

Betcoin is one of the companies basing their deposit speed on the fee associated with the transfer. One Reddit user pointed out how his transfer had to wait for six full network confirmations, as that particular transaction fee was well below 0.0001 BTC. One might argue that not much harm can be done with such a small deposit, but some companies are adapting their policies in this regard.

Needless to say, this decision can be both annoying and a positive sign at the same time. For people looking to deposit small amounts to their Betcoin account, any transaction with a fee below 0.0001 BTC might be annoyed by the wait. But at the same time, those players who want to send over large sums of money will have to wait for one confirmation, a slong as their transaction fee meets the threshold.

Accepting unconfirmed transactions by the Bitcoin network holds a certain risk for any company dealing with digital currency. Requiring a minimum transaction fee prevents platforms from coming under attack by low-fee attacks. Double spending after one network confirmation is rather unusual, though, and a fine balance has to be struck between verifying genuine deposits and serving the customer in time.

Source: Reddit

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