While both Bitcoin and Ethereum are trading at lower prices than they were earlier this year, there is a silver lining: transaction fees on these leading blockchains have dropped significantly. With current low costs, this could be an ideal time to optimize transaction costs for certain activities or even harvest unused transaction outputs for greater efficiency.
Crypto Optimization: Why Now Is the Best Time to Consolidate, Move Funds, and Test Apps
Currently, transferring funds on the Bitcoin blockchain costs an average of about 0.000016 BTC, or about $0.92, according to data from bitinfocharts.com. Meanwhile, mempool.space reports that on September 13, 2024, the high-priority transfer fee was 3 satoshi per virtual byte (sat/vB), which is only $0.24. However, if BTC prices rise and network activity increases, moving your funds could become much more expensive.
With fees currently low, this is a great opportunity to optimize your unused transaction outputs (UTXOs). Bitcoin fees are based on the amount of data transferred on the network, and more UTXOs means more data, which leads to higher fees. Consolidating your funds now while fees are low can save you money in the future. BTC’s reduced fees are great for managing a wide range of everyday transactions. Whether it’s sending payments, consolidating wallets, or simply transferring funds onto the platform.
Ethereum, however, does not use a UTXO model, so consolidation is not required. However, periods of low fees are a great time to perform other types of transactions, such as moving ether, exchanging or transferring ERC20 tokens, conducting a non-ether token (NFT) sale, or bridge funding. When fees are low, the Ethereum network becomes a playground for transactions that would otherwise cost much more and sometimes even fail.
What do you think about the reduced fees in the Bitcoin and Ethereum networks? Share your thoughts and opinions on this matter in the comments section below.
