When you make cryptocurrency transactions, certain features are probably more important to you than others. The fees and transaction time are vital when you want to keep track of your funds. In this article, we present you a synopsis of useful facts about the real costs of using cryptos.
The fee and the time
Firstly, you need to understand what the fee is actually for. Generally speaking, in every mined cryptocurrency, the fee goes to the miners, in exchange for the mining job. But obviously the amount we pay varies, depending on what cryptocurrency we are talking about.
When it comes to transaction time, it just depends on the characteristics of a cryptocurrency and the purpose it has been created for. Some coins are known for being very fast to transfer while others have different advantages. It is all related to the speed of data transmission between the nodes. The transfer needs confirmations from the miners that accept the transaction and save it into the blocks in the blockchain. It’s the confirmation that takes time, not the transaction itself.
Now, let’s look at some examples.
Let’s take Bitcoin, for example. The fee is determined by the market. Bitcoin is the oldest cryptocurrency, so it also uses the most ancient solutions. For the last 10 years a lot has changed in that matter. But obviously, the rules can’t be changed now.
The duration time of the transaction in case of Bitcoin is not very impressive though. This cryptocurrency takes a long time to confirm the transaction. It usually lasts about 60 minutes, but sometimes it can take up to 16 hours, when the network is especially congested. The Bitcoin network is just not efficient enough to quickly handle all of the transactions. This fact has been officially confirmed in December 2017.
This crypto is quite complicated when it comes to calculating the transaction fee and it varies, depending on many different factors. The fee amount is also dictated by the market, like in case of Bitcoin. Generally, the fee is 0.001 LTC and it’s multiplied by the number of bytes we transfer. But Litecoin also charges you another 0.001 LTC if your transaction output is under the 0.001 LTC threshold. It’s due to the dust mitigation.
Litecoin was created as an alternative for the big and slow Bitcoin and it was supposed to be light, cheap and fast. It takes several dozens of minutes to transfer Litecoins. It’s not one of the fastest cryptocurrencies, but also not one of the slowest. It’s basically located somewhere in the middle.
Now let’s analyse one of the relatively new coins. FuturoCoin was created at the beginning of 2018, so it’s not even a year old. It’s the perfect example of a crypto that has a fixed transaction fee. It is 0.0006 FTO, no matter how much money you transfer. It’s quite convenient because you don’t have to worry about calculating the fee every time you make a transaction.
The transaction time in case of FuturoCoin is quite special and it distinguishes it from many other cryptos. Just a second or less – that’s how long it takes for the coins to travel between wallets. That’s because it needs no confirmation from the miners to be sure to accept the payment from the payer as valid, unlike the other cryptos do. The FuturoCoin transfer is even quicker than some of the fastest bank transfers that we make daily.
As we can see, the more recent coins usually offer us better conditions, simply because they are more suited to the current situation on the cryptocurrency market. They have been created recently, which means they use the latest solutions, in opposition to, for example, a ten-year-old Bitcoin. You need to take that into consideration when you’re deciding what crypto to buy.
Obviously, apart from the basic individual transaction fees for every cryptocurrency, there are also fees on the exchanges. You should be careful when choosing a platform – always read all the regulations. Make sure you know all the costs before starting trading, so you can make money safely and without any unpleasant surprises!
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