Payments of the Future
The Role of Transaction Fees
Transaction, where art thou? Many remember the long times of waiting for confirmations when sending BTC during the months at the end of 2017. However, over the past few months, mass adoption of cryptocurrency has been taking a giant step “behind closed curtains”. After the establishment of thousands of new payment channels, the Bitcoin ecosystem is also about to undergo some major changes with development of the Lightning Network coming up. A few days ago some of the details were revealed to CoinDesk by the MIT.
In the meantime, PURA’s next-generation peer-to-peer payments network doesn’t leave transactions hanging or leave anything to chance. PURA is hard-coded to financially reward incentivised individuals who actively protect the PURA network. Masternode owners operate servers that remain online, performant, and on call at all times, all over the world. Your transactions are instant, private and safe from day one. Among other things, it is a fact that the future of mass adoption depends upon fast transaction times and ultra-low transaction fees. PURA is more than set for this challenge.
So we thought we would take a look – what are transaction fees, really? Why are they important? And what is an acceptable time period for a transaction?
If you are buying or selling an order on a cryptocurrency exchange, cryptocurrency exchanges charge fees as a type of commission to process your order. Some exchanges have fixed fees while others do not. Some platforms have a model in place called the “maker-taker model” where fees vary according to liquidity taken or provided by market participants. Thus, we recommend doing your research on which exchange is the most suitable for your needs.
According to the most recent news, the big cryptocurrency exchanges Bitfinex and GDAX recently completed implication of the SegWit protocol, thus greatly improving network transaction capacities and offering users reasonable transaction fees.
Further, the utilization of a network to verify and validate transactions by miners to add them to the blockchain results in transaction fees for users. Miners set the prices for transactions and rank them according to priority. The lower the fee a user is willing to pay, the longer validation of a transaction will take. Network fees are a vital component on the road to mass adoption. Bitcoin’s technology in terms of transaction verification is extremely slow in comparison to banks and credit card providers.
Slow And Old
For instance, Bitcoin can process only seven transactions each second (current average is approximately 4 transaction per second) in comparison to Visa which handles an average of 1,700 transactions per second – and over 150 million transactions every day. Indeed, the proposed Lightning Network is to target this problem. Actually, this development is regarded as one of the most potent solutions to cryptocurrency scaling currently under development. However, currently the average transaction time in the Bitcoin network is approximately 15 minutes. Transaction fees (miners revenue divided by the numbers of transactions) were above US$ 75 on average over the last week, on top of the slow network.
Cross Border Payments
In a recent survey of women working in digital industries, conducted by the cross-border payment company Transpay, a large share of women freelancers in the United States (41 percent) and India (90 percent) who sell their products or services using digital channels, identify transaction fees on cross-border payments as one of “the biggest challenges facing their self-employed online business.” In the meantime, Argentina’s Banco Masventas has revealed that it will enable customers to send cross-border payments using Bitcoin. Unquestionably, in the scope of future developments of online payments, cryptocurrencies have not even begun to unleash their huge potential.
PURA for the Common Good
PURA is a cryptocurrency to provide you and society as a whole with a foundation to practice decentralized social responsibility and contribution. To emphasize, PURA is for putting decision-making power on how to allot funds for common good back into the hands of people. The PURA community wants to make a difference. In detail, PURA wants to establish an environment that pioneers a new method of societal organization. This way, you can help to work towards the common good.
In line with all this, thank you for being part of the PURA Community and for your ongoing support! Please read our Whitepaper for more information.