Transaction Fees are climbing on Bitcoin and Ethereum - HIVE will never have this issue...
The drawback of higher prices is often higher network transaction fees...
One thing that sometimes gets overlooked when bitcoin starts going up in price is the fact that network transaction fees tend to go up as well.
As I type, the transaction fees on bitcoin are the highest they have been in roughly a year.
If you are moving large amounts of money/btc, then the higher transaction fees aren't a big deal, but if you are moving small amounts, the higher fees can really eat into things...
Here's the average btc transaction fees over the last year:
(Source: https://cryptonews.com/news/bitcoin-and-ethereum-users-complain-about-rising-ridiculous-6560.htm)
That is the rolling 7 day average bitcoin network transaction fee and as you can see, we are getting to levels not seen in roughly 10 months.
It's not just Bitcoin...
People like to point to this as a reason bitcoin can't scale, but it's not just bitcoin that is seeing rising transaction fees.
Ethereum is seeing a similar rise in transaction fees as well.
In fact, on a percentage basis, the rise in ethereum fees is almost the same as bitcoin's:
(Source: https://cryptonews.com/news/bitcoin-and-ethereum-users-complain-about-rising-ridiculous-6560.htm)
This somewhat flies in the face of those claiming this is a BTC specific issue, it's clearly not.
As transactions flood in and the mempool gets overcrowded people are willing to pay higher and higher fees to have their transaction take precedence over the others. This causes fees to keep climbing.
Eventually there is an equilibrium point where people are no longer willing to pay the higher fees so the network slows way down and the backlog of transactions gets worked through.
The bad news is that if there are people depending on transfers/transactions going through, they have no choice but to pay the higher fee or wait a long time to get their transaction confirmed.
This is where HIVE comes in...
While this is an issue for using bitcoin for every day payments due to the high fees, it still doesn't impact the very large transactions as the higher fees are likely still well below what it would cost to move that amount of money through legacy financial systems.
That being said, it's times like these were HIVE needs to really advertise/promote the free transaction benefit. With free transactions, HIVE will never have this problem...
It's one of the real competitive advantages HIVE has, and now is the time to really push that narrative...
"Sick of paying high fees with bitcoin and ethereum, come check out HIVE where transactions are FREE!"
Stay informed my friends.
-Doc