Every Bitcoin transaction includes a fee paid to miners. The fee is the difference between the total inputs and the total outputs in the transaction. Miners collect these fees as part of their reward for including your transaction in a block.
Fees exist because:
- Miners spend real money on hardware and electricity.
- The protocol subsidizes them with new coins for a while, but over time fees become more important.
- Fees also help prevent spam by making it costly to flood the network with useless transactions.
Why fees behave differently on BSV vs BTC comes down to block size and capacity.
On BTC:
- The block size is intentionally limited to a small capacity.
- During busy periods, there is more demand for block space than there is supply.
- Users compete for limited space by bidding higher fees.
- This creates volatile fees, sometimes very high, and confirmation delays for low fee transactions.
On BSV:
- The protocol allows very large blocks and focuses on scaling on chain.
- Miners can process a much higher volume of transactions.
- Because capacity is abundant, there is less competition for space.
- Fees can be kept very low and stable, and miners make money on volume rather than high fees per transaction.
In simple terms:
- BTC behaves like a crowded highway with tolls that spike during rush hour.
- BSV behaves like a multi lane highway that keeps adding lanes so everyday tolls stay low and predictable.
For regular users and businesses, stable and low fees make it easier to plan and build real world applications.