Does Bitcoin's high price make payments in stores less viable?

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With bitcoins values getting so high (now is $2250/BTC) is it still viable to use bitcoins as a way of payment in stores?

It's not that common now, but I thought that people would use it more with time. Now with the high values of BTC the fees to the miners are pretty high. In order to get a fast transaction I had to pay around $2. This would discourage low values transactions, right?

Is there a way to improve this situation? Would it for example help to increase the number of miners? Is it otherwise correct to assume that Bitcoin will only be viable for high value transactions?

Jp_

Posted 2017-05-29T14:44:57.107

Reputation: 143

2You are asking several different questions here, some of which are very subjective. Can you focus your question more narrowly? By the way, increasing the number of miners will not change anything, except temporarily - the rate of confirmed transactions is limited by block size, and the Bitcoin protocol keeps the block rate approximately constant over time. There are many questions about this issue on the site. – Nate Eldredge – 2017-05-29T16:02:04.160

Nate is correct by the way, you really shouldn't ask about multiple different topics in one question. ;) – Murch – 2017-05-29T20:36:45.670

Answers

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Bitcoin for Point-of-Sale

Bitcoin is inherently ill-suited as a form of instant payment. This is due to transactions needing confirmations before they become reliable which even at best times can take between several minutes and an hour. Before a transaction is confirmed, it is merely a declaration of intent open to replacement by another transaction sending to a different recipient, i.e. a doublespend. This is in crass conflict with the requirements of a quick payment, e.g. at a super market with a line forming behind you or when purchasing hot food.

Value of transactions and fee market

Fees in Bitcoin are paid for the blockchain space that a transaction occupies, not relative to the amount of value that is transferred. As the data-wise smallest possible transaction could transfer $1 or $1,000,000 of value, it is obvious that a more valuable transaction can afford to pay a higher fee for the same blockspace while remaining economically viable. It is therefore inevitable that more valuable transactions will push out less valuable transactions in the competition for blockspace.

More miners and throughput

To discover a new block, a miner has to find a block template that fulfills the current difficulty level. This is a rebalancing system, if mining power increases, the difficulty will follow suit to slow down block discovery. Adding more mining power will only briefly create more capacity before the difficulty catches up.

Murch

Posted 2017-05-29T14:44:57.107

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Asked: 2017-05-29T14:44:57.107

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Active: 2017-05-29T20:38:35.120