Mempool Clears but Fees do NOT Drop --- What am I missing?

[wry]

I have a question that I hope someone here can help me with.

So the mempool is the number of Bitcoin transactions waiting to be included in a block.

Fees are amounts users pay miners to include their transaction in a block.

So what confused me was if you look at the mempool on blockchain info at: https://www.blockchain.com/charts/mempool-size?

You'll see it dropped to zero about 24 hours or so ago.  (It has since ticked back up.)

However, fees, according to fee estimator:  https://bitcoinfees.earn.com/ did not drop, in fact, they hardly moved at all either up or down.

My question is, if the mempool clears should not fees drop as there is no need to bid up the price to be included in a block?

Does blockchain not show the mempool correctly?

Is the fee estimator garbage? 

Or am I just misunderstanding how things work?

Thanks for any insight you can provide!

[MadMartingale]

see i thought the fees were determined by the difficulty of mining blocks, when bitcoin had the first spike $19,000 plus, fees went up a lot when it went down fees stayed the same , shouldn't it have just raised incrementally . im confused about that as well. i think everyone took that as an opportunity to profit off of people.

seems the more value crypto gets the more the little guy gets taken advantage of. just wish there were some sites that actually helped the poor people , every site i try just gets harder to profit . i use paxful to get crypto. i guess i should be thankful to spend money for the privilege of playing at these sites cuz the rate of return is extremely low

[allisonn]

You are comparing extremes from different points of time.

The fee estimation site logs fees for 24 hours. You can see 31k txs done with 1-2 sats, when the mempool was clearing. However before and after that, obviously the txs with highest fees are the ones clearing.

Also it doesn't take that many txs to set off a bidding war to get your tx into the next block. Customer facing sites like Stake or Coinbase will pay almost any price for next block conf. As soon as one block fills up with high fees (pending mining), you need to outbid the lowest guy to be next block. All this is transparent, so another site sees the state of the pending fees and has to adjust as well. Other fee estimator websites will see this as well, etc etc.

Another factor: It doesn't really hurt that much and customers always want their funds now now now. Companies will rather overpay in fees than have funds delayed and deal with complaints. Even when the mempool was 1-2 MB in size, which means almost anything would be next block, people/companies were still paying 100-200 or even 400 sats/byte.

I recommend using https://jochen-hoenicke.de/queue/#0,24h for a good overview of the state of the mempool and to estimate fees manually. You can see that even when everything was clearing easily, there was a lot of overpaying in fees.

[wry]

3 hours ago, allisonn said:

You are comparing extremes from different points of time.

The fee estimation site logs fees for 24 hours. You can see 31k txs done with 1-2 sats, when the mempool was clearing. However before and after that, obviously the txs with highest fees are the ones clearing.

Also it doesn't take that many txs to set off a bidding war to get your tx into the next block. Customer facing sites like Stake or Coinbase will pay almost any price for next block conf. As soon as one block fills up with high fees (pending mining), you need to outbid the lowest guy to be next block. All this is transparent, so another site sees the state of the pending fees and has to adjust as well. Other fee estimator websites will see this as well, etc etc.

Another factor: It doesn't really hurt that much and customers always want their funds now now now. Companies will rather overpay in fees than have funds delayed and deal with complaints. Even when the mempool was 1-2 MB in size, which means almost anything would be next block, people/companies were still paying 100-200 or even 400 sats/byte.

I recommend using https://jochen-hoenicke.de/queue/#0,24h for a good overview of the state of the mempool and to estimate fees manually. You can see that even when everything was clearing easily, there was a lot of overpaying in fees.

Thank you very much for your thoughtful response!  I see now about the 24 hours on the fee estimator site.  That explains a lot!  Thank you also for suggesting an alternate resource to see the mempool.  That is an outstanding site!

[williamshennie9]

If it was not for this article, I would have never even noticed the difference in the fees. I, and I would assume most other people don't pay too much attention to these sorts of things, so it is very helpful that you've pointed it out to us I'll pay close attention to the fee structure for future to ensure I am paying the correct amount