Home CryptocurrencyAltcoin How to Transfer $1 Billion for Basically Free: Bitcoin Whale Watching

How to Transfer $1 Billion for Basically Free: Bitcoin Whale Watching

by SuperiorInvest

Billionaires, take note. It’s a million times cheaper to send huge sums of money to bitcoins (BTC) blockchain.

A bitcoin user sent over 50,562 BTC ($1 billion) to an address on the blockchain and paid a fee of just 2,513 satoshi (the smallest denomination of bitcoin), equivalent to half a dollar for the pleasure.

Transaction sankey diagram showing fees, value and time. Source: mempool

The unknown wallet address paid a tiny fraction (less than 0.0001%) of the total transaction value. Simply put, the user paid 50 cents to move twice the GDP Bitcoin Friendly Tonga Islands. This billion dollar transaction was processed in block 761374 for a transaction fee of just 15 satoshis (sats) per unit of data or sats/vByte.

Cointelegraph experimented with various online banking services to estimate the cost of sending huge amounts of money through legacy financial instruments. For a $10 million transfer, a well-known transfer provider charges a tiny fraction, 0.3%, which equates to $30,000. This is a million times more expensive than using the Bitcoin blockchain to send money.

Experimenting with sending huge amounts of money using legacy financial tools. Source: Wise

Before a new Bitcoin block is mined, each Bitcoin transaction request resides in a memory pool, or “mem pool,” which is sort of like a Bitcoin bus stop. On average, miners mine a new block for 10 minutes.

Bitcoin miners sort transactions and process passengers who have the most expensive bus tickets (transaction fees) first. Usually, the higher the transaction fee, the faster the transaction is confirmed. At 15 sats/vByte, the cost to send more than 50,000 bitcoins is very low, indicating that this bitcoin whale was in no rush.

In comparison, a fat-fingered Bitcoin user paid in late October an incredible 8,042 sat/byteor 1,136,000 sats to move 3.8 bitcoins ($65,000).

The process of ordering transactions in the mempool is quite simple for miners. Contrary to the belief of many Bitcoin critics, this is not an energy intensive process. Bitcoin’s energy consumption ultimately comes from issuing block rewards, not transactions.

Related: BTC Miner CleanSpark Collects Thousands of Miners Amid ‘Unsettled Markets’

The bitcoin whale address continued to send over 50,000 bitcoins to various other addresses on the blockchain. The addresses are not publicly known addresses, such as Binance’s cold storage space wallet or bitcoins mined in 2009, which was subsequently lost incl landfill in Wales.

Source Link

Related Posts

%d bloggers like this: