Making Sense of Bitcoin Transaction Fees

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Every Bitcoin transaction is subject to a fee paid by the sender. In contrast to bank fees charged at either a flat rate or as a percentage of transaction value, Bitcoin fees are based on the amount of data needed for encoding. Understanding this system is not difficult, but its nuances and non-intuitive nature confuse many Bitcoin users, new and experienced alike.

Understanding transaction fees can save you both money and time. This guide describes how the Bitcoin transaction fee system works and how to use it effectively.

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