Michael Matulef on Nostr: The fact that some transactions are driven by arbitrary preferences rather than pure ...
The fact that some transactions are driven by arbitrary preferences rather than pure economic motives is a sign that there is currently an oversupply of blockspace relative to demand.
Transactions reflecting subjective values don't directly cause higher fees themselves. Higher demand relative to the inelastic supply is what drives fee increases through market pricing.
Those promoting "hyperbitcoinization" where Bitcoin is widely used must understand that successfully increasing demand while supply is constrained will necessarily lead to higher prevailing fees. Advocating for both universal adoption and low fees is inconsistent.
Lower fees require demand to be comfortably below the level of supply. Wanting widespread use of Bitcoin while also demanding low fees defies economic principles of supply and demand. As a scarce resource, blockspace will be priced accordingly by the market. The only way for low fees to persist is if demand cools off.
Transactions reflecting subjective values don't directly cause higher fees themselves. Higher demand relative to the inelastic supply is what drives fee increases through market pricing.
Those promoting "hyperbitcoinization" where Bitcoin is widely used must understand that successfully increasing demand while supply is constrained will necessarily lead to higher prevailing fees. Advocating for both universal adoption and low fees is inconsistent.
Lower fees require demand to be comfortably below the level of supply. Wanting widespread use of Bitcoin while also demanding low fees defies economic principles of supply and demand. As a scarce resource, blockspace will be priced accordingly by the market. The only way for low fees to persist is if demand cools off.