Blockchain
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What are cryptocurrency fees?
From the moment the cryptocurrencies are sent, the transaction fees appear. They are necessary to maintain the extensive computer networks that support various blockchains and to ensure their security.
Transaction fees mainly depend on how much cryptocurrency you want to send, how quickly you want to withdraw it from the wallet, and ultimately the level of network congestion.
The best ways to avoid cryptocurrency fees
You may have guessed it by now, but one of the easiest and most effective ways to avoid crypto fees is to buy your favourite cryptocurrency and “hodler” (hang in there no matter what!). However, dapp development company there are also other tricks you can apply when looking for transactions that have low or no fees.
Avoid rush hours when buying/sending cryptocurrencies
Another easy way to avoid high cryptocurrency fees is to look at the network congestion you will be using. When it is high, it may be wise to wait until the network is less congested. If the number of transactional congestion decreases, the rates also decrease.
In general, most blockchains are busiest during peak trading hours in the US, approximately 8:00 a.m. to 1:00 p.m. Eastern Time.
Use a layer 2 like Lightning Network or Arbitrum for Ethereum
If you want to use Bitcoin to make micropayments or regular transactions, then the Lightning Network (network of payment channels) is your best option. The so-called lightning network transactions are a two-party payment channel that only exists outside of the blockchain and as such provides faster transaction finality by paying minimal fees.
Another good way to save big on high transaction fees is to use another Layer 2 solution, Arbitrum, which is similar to the Lightning Network, but works as a solution for congestion and high fees on the Ethereum network.
Find exchanges with little or no fees
You can also look for exchanges that offer free transactions. Many of them claim not to charge any fees. However, they make their profit by charging a premium for the Bitcoin they sell. In other words, decentralized application development you'll likely end up paying the fees anyway.
It may also be worth comparing between the various exchanges out there. Don't forget: everyone wants your hard-earned money, so do your research and find deals and discounts. Notwithstanding, security should be the main concern.
Here are some of the best cryptocurrency exchanges .
Exchange cryptocurrencies in person
If you are adventurous and determined to save yourself the fees, you can also choose to buy the cryptocurrency from an in-person seller. But beware of scammers if you decide to go this route.
It is better to deal with crypto fees than to be mugged in some dark alley.
Conclusion
Do you remember the saying “nothing in life is free”, which conveys the idea that it is impossible to get something for nothing? The same applies to cryptocurrency fees. They exist to compensate miners and validators who help keep the network secure. Besides, the people in charge of the exchange platforms also have to make a living, right?
Currently, there is no way to avoid paying any amount of fees when transacting with cryptocurrencies. But maybe it won't hurt so much now that you understand why they exist and where your fee money goes.
Furthermore, the circulation of large amounts of Bitcoin, sometimes millions and even billions, can be done in the blink of an eye and for only a few dollars. This is unfathomable in the customary monetary world. So perhaps we shouldn't worry too much about cryptocurrency fees.
From the moment the cryptocurrencies are sent, the transaction fees appear. They are necessary to maintain the extensive computer networks that support various blockchains and to ensure their security.
Transaction fees mainly depend on how much cryptocurrency you want to send, how quickly you want to withdraw it from the wallet, and ultimately the level of network congestion.
The best ways to avoid cryptocurrency fees
You may have guessed it by now, but one of the easiest and most effective ways to avoid crypto fees is to buy your favourite cryptocurrency and “hodler” (hang in there no matter what!). However, dapp development company there are also other tricks you can apply when looking for transactions that have low or no fees.
Avoid rush hours when buying/sending cryptocurrencies
Another easy way to avoid high cryptocurrency fees is to look at the network congestion you will be using. When it is high, it may be wise to wait until the network is less congested. If the number of transactional congestion decreases, the rates also decrease.
In general, most blockchains are busiest during peak trading hours in the US, approximately 8:00 a.m. to 1:00 p.m. Eastern Time.
Use a layer 2 like Lightning Network or Arbitrum for Ethereum
If you want to use Bitcoin to make micropayments or regular transactions, then the Lightning Network (network of payment channels) is your best option. The so-called lightning network transactions are a two-party payment channel that only exists outside of the blockchain and as such provides faster transaction finality by paying minimal fees.
Another good way to save big on high transaction fees is to use another Layer 2 solution, Arbitrum, which is similar to the Lightning Network, but works as a solution for congestion and high fees on the Ethereum network.
Find exchanges with little or no fees
You can also look for exchanges that offer free transactions. Many of them claim not to charge any fees. However, they make their profit by charging a premium for the Bitcoin they sell. In other words, decentralized application development you'll likely end up paying the fees anyway.
It may also be worth comparing between the various exchanges out there. Don't forget: everyone wants your hard-earned money, so do your research and find deals and discounts. Notwithstanding, security should be the main concern.
Here are some of the best cryptocurrency exchanges .
Exchange cryptocurrencies in person
If you are adventurous and determined to save yourself the fees, you can also choose to buy the cryptocurrency from an in-person seller. But beware of scammers if you decide to go this route.
It is better to deal with crypto fees than to be mugged in some dark alley.
Conclusion
Do you remember the saying “nothing in life is free”, which conveys the idea that it is impossible to get something for nothing? The same applies to cryptocurrency fees. They exist to compensate miners and validators who help keep the network secure. Besides, the people in charge of the exchange platforms also have to make a living, right?
Currently, there is no way to avoid paying any amount of fees when transacting with cryptocurrencies. But maybe it won't hurt so much now that you understand why they exist and where your fee money goes.
Furthermore, the circulation of large amounts of Bitcoin, sometimes millions and even billions, can be done in the blink of an eye and for only a few dollars. This is unfathomable in the customary monetary world. So perhaps we shouldn't worry too much about cryptocurrency fees.
