Litecoin Core 0.17 will see fees lowered by 10x - Litecoin News. Sunday, October 21st
Litecoin Core 0.17 will see fees lowered by 10x
About half a cent will cost processing 1 KB
Litecoin (LTC) is preparing to launch its next update, Litecoin Core 0.17, and it promises to reduce current transactions fees by a factor of 10. According to a Medium post, the improvement will have users sending and receiving funds as cheap as $0.005 per KB.
Adrian Gallagher, Core Lead Developer, explains that this is done in hopes of promoting mainstreaming of the 7th largest cryptocurrency by market cap. “To encourage more adoption and usage of Litecoin, I think lowering the fees are good thing,” he said, adding that since block size on disk is relatively small, and block limits has not been reached yet, people could technically adjust their fees to the one the update will bring about.
As of right now, the average transaction fee on the Litecoin Network is about $0.05 per KB. With the reduction – per the post – fees will be back at the same levels reported back in 2015.
Gallagher also gave his opinion on the bear market, believing that it should be over in about 3 to 6 months. “I also don’t think it will be too much longer before this bear market is over (3–6 months) so it will lay down the foundation for a fee rate which we can grow into proactively rather then re-actively.”
How transaction fees work, and why they exist?
The transaction fees are determined by the space a transaction uses in a block. Confirming any operation on the blockchain means that they will be added in a block, and depending on how large a transaction data is, fees will be somewhat large, too. Unlike traditional financial operations, where payment processors can charge a fee based on the amount sent or received (i.e. 1% of the amount sent), transactions fees on the blockchain are calculated based on the number of addresses involved in the movement of the funds.
Aside from serving as an incentive for miners (although it is not as big as the money they get for mining a new block and claiming the reward, 25 LTC or $1,300, at press time), they also prevent and discourage spam on the network. Another interesting thing is that they create a hierarchy of demand, that is, the more someone pays in fees, the sooner their transaction will be included in a block.
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