Miner fees are dynamic and always make the news because they’re so high. They’re not always so high, but Bitcoin has gone through several periods where network congestion made miners’ fees very high. In other words, if many transactions are happening in the system, the miners’ fees would likely be very high due to the congestion. That’s comparable to Uber rates during rush hour.

To put things into perspective, in April and May 2021, many transactions were happening on the market, making fees as high as $50. They were also very high back at the end of 2017 when Bitcoin hit a price record shy of $20,000.

Imagine you want to send a friend $20 worth of Bitcoin, but the fee alone costs $50. Transaction fees like that would make you not want to use it, except for larger transactions. People began to jump on the Bitcoin bandwagon when its price skyrocketed. All that activity led to high miners’ fees, which caused a lot of complaints. Now, fees are generally much lower.

The number of inputs on a transaction could also cause higher fees. If you send some Bitcoin and it’s broken up into smaller pieces, these smaller pieces add more memory to the transaction. That means they’ll be processed with a larger memory size, and the miners’ fees will increase as they incur a higher cost.

Let’s address the elephant in the room. Why do fees exist, to begin with?

These fees give incentives to the miners to verify the blocks. Miners verify each block using mining machines that crunch the numbers on the cryptographic puzzles. When the miners complete a block, they receive some Bitcoin as a reward.

Regarding rewards, miners can prioritize which transactions they include in a block. The higher the miner fee, the higher the chances the miner will include it in the current block. In some cases, if your transaction carries a lower fee, it might take a few blocks until a miner picks up your transaction, puts it into a block, and verifies it. That way, the mining system is incentivized for the miners, too.

Bitcoin blockchain can only progress with the miners who complete transactions. That’s why the miners and their fees are critical to the Bitcoin ecosystem.

Another important thing to mention is how to pay the miners’ fees. Don’t worry: most wallets will include that in your transaction. They’ll deduct the miners’ fees from the amount you’re sending.