Bitcoin miner fees are small amounts of bitcoin given to incentivize bitcoin miners (and their operators) to confirm Bitcoin transactions. These fees do not go to BitPay. Bitcoin miners are the special pieces of hardware that confirm and secure transactions on the Bitcoin network. Miner fees pay miners for the service they provide.
What do bitcoin miner fees do?
Bitcoin miners confirm and secure transactions by adding blocks to the blockchain. A block is a group of transactions. The blockchain is Bitcoin's shared public record of transactions. It is a chain of all past transactions. Miners must add transactions to the blockchain so the transaction becomes final. No one is able to reverse a transaction once miners add it to the blockchain.
Miners use the miner fees attached to transactions to decide which transactions to confirm first. A large enough miner fee makes it more likely that your transaction will confirm in a short period of time. If you use use a miner fee that is lower than you should have used (or no fee at all), your transaction may take days or even weeks to confirm. The Bitcoin network may reject your transaction altogether and return the funds to your wallet.
Why are miner fees so high?
Bitcoin miner fees are currently very high due to high bitcoin network demand and limited bitcoin network space.
Only a limited amount of data (and so a limited number of transactions) can be added to the Bitcoin blockchain at a time. With more and more people sending more and more transactions, the cost for getting into the next "block" of bitcoin transactions is getting higher and higher.
Because Bitcoin Cash currently has lower miner fee levels, you may also choose to pay a BitPay invoice with Bitcoin Cash if you are concerned about high costs.
View current average bitcoin miner fee costs. Chart source: bitcoinfees.info
How do I send bitcoin miner fees?
Most true bitcoin wallets include a bitcoin miner fee in all outgoing transactions. To make sure your wallet includes a correct miner fee, change your settings to include a dynamically-calculated fee. That will make sure your transaction arrives on time, even when the Bitcoin network is busy. Wallets like our BitPay bitcoin wallet include this setting by default.
If you would like to customize your bitcoin miner fee on the BitPay Wallet, check out this video. Remember that you can only customize the fee right before you make a transaction.
Note: some bitcoin exchanges won't send a miner fees when they transfer funds. Instead, they will deduct the miner fee cost from your outbound transaction.
For more information about bitcoin miner fees, check out the following articles:
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