Who gets Bitcoin Network Fee and How It Calculates?
Higher the fee, faster the transaction confirmation.
Question:
I want to know who receives the Bitcoin network fee when I make a transaction on the Bitcoin network, and how the total network fee I pay for a transaction is calculated?
Answer:
Who Receives Bitcoin Network Fees?
When you send transaction on Bitcoin, you can choose to pay a fee to the miners who verify and add your transaction to the blockchain. Miners prioritize transactions based on the fee they offer.
Higher fees will be processed faster, but even low-fee transactions will be processed but they may take hours or days.
Miners are people who use their IT infrastrucutre to verify Bitcoin transactions and add them to the blockchain. They do this by solving complex mathematical problems. In return for their work, miners are rewarded with Bitcoin (network fee).
How My Total Network Fee Calculates?
When you make a Bitcoin transaction, you can select the fee in satoshis per virtual byte (sat/vB). However, you typically don't know how many virtual bytes (vB) your transaction will take up.
This is because the size of a transaction can vary depending on a number of factors, such as the number of inputs and outputs, the size of the inputs and outputs, and the type of transaction.
To help you estimate the fee for your transaction, many wallets will show you a preview of the total network fee (in BTC) that you will likely pay. This preview is based on the current network conditions and the fee that you have selected.
