Transaction fees, explained

Today, there are dozens of popular blockchain projects that charge different transaction fees.

A simple rule of thumb is this: the higher the network’s throughput, the lower the transaction fee.

The standard fee of a Ripple transaction is 0.00001 XRP as of today, and it peaked at over 0.40 XRP for a very short period in 2017.

On Ethereum, transaction fees are higher and can surge during congestion on the network.

Some people were quoted fees of $99, prompting speculation that some protocols would begin to seek alternative blockchains.

Demand for transactions has become a big problem for this blockchain, but it’s hoped that a long-awaited upgrade to Ethereum 2.0 will deliver a better fees system.

Ethereum’s co-founder, Vitalik Buterin, has expressed concerns that high fees could encourage selfish mining practices.

As for Bitcoin, the largest cryptocurrency by market cap has also seen a considerable increase in the price of transaction fees this year.

Besides Bitcoin and Ethereum, other blockchains including Litecoin, Bitcoin Cash, Cardano and Ethereum Classic have much lower fees of below one cent on average.

Elsewhere, ILCoin also has infinitesimal transaction fees, and it relies on a PoW protocol inspired by Bitcoin.