Higher XEM price, higher network cost

General Discussion
#1

There are two things not clear to me until now.

First, why is there a minimum fee of 1 XEM? I bought a few XEM for playing around with it. At the actual price, I pay for a transaction equivalent to 1.0$ almost 10% fee. This is huge, isn’t it? I get that for high amounts of money the TX fees are comparatively small, but if XEM should be the currency for everyday business, this makes no sense. There is no way I can buy a chewing gum or a coffey with it like that for the moment. Additionally there are 6 decimal places - shouldn’t it be possible to use them for micro transactions too?
With that market cut out, I can only assume that the actual price is due to investors with a lot of money and not the normal wallet user. In my opinion this is a problem that should be solved if NEM wants to sustain.

Second, to me is not clear if there is still some way to add some XEM to the system. Because money will be lost and get locked. Can’t that get problem at some point, when less and less money is in the actual system?

Thank you in advance
mebt

2 Likes
#2

I agree with you completely. I think of NEM as a fast, scalable payment network. Unlike Bitcoin, which I think of as a long term store of value, like real estate or gold. It doesn’t bother me when Bitcoin fees are high because occasionally when I transact in BTC, it’s for a high value, I don’t mind the 30 minute wait, and the fee is negligible. If I were spending XEM on everyday purchases, I could not afford to pay the fee of 1 XEM (currently USD $0.12). Assuming XEM continues to increase in value, the minimum transaction fee could quickly approach $1, and that’s for transactions under 20,000 XEM.
In today’s fiat currency world, this transaction fee is also paid by the customer, but it’s less obvious. All retailers must mark up their prices, with the assumption that the customer will pay using a credit or debit card. If you have a good credit card, you will get some of that money back as Rewards. When retailers begin accepting virtual currencies, they will cover the fees and mark up their prices like we’re used to.
The difference is that if I wanted to transact XEM with friends, there would be no retailer to cover the fees, and the individual would bear this cost. Now, there’s nothing wrong with paying for what you use, but if the fees are high, then there is no reason for NEM. There are no fees when I hand my friends cash, so why should i use XEM instead? The transaction fee for Bitcoin is only slightly higher than NEM, but mining Bitcoin requires a giant amount of resources, and therefore deserves a higher bounty. The Proof of Importance model was designed to make harvesting easy on resources and accessible to anyone. Or is it?

1 Like
#3

The Devs just need to catch up. The spike in price has been sudden and just a few weeks ago 1XEM was very cheap. Just my thoughts.

#4

It’s still far cheaper than bitcoin right now, but yeah they need to revise the fees downward. I do like how the fee is fixed based on the amount sent, it eliminates the guesswork. .1 XEM instead of 1 XEM, keep all the other variables the same.

When XEM hits 30 cents a transaction will only cost 3 cents for the first 20,000 instead of 30 cents. Works for me.

#5

I like a fixed fee as well, stop loss of NEM like the guy did with 100s of BTC when filled out the wrong thing.

Now that said, what is our “block size” how may transactions in one “block” if this is the way it works

So perhaps a siled scale fixed fee so effectively anchored to USD costs so 0.1 NEM would be 1.2 cents…

#6

Hey Jubalix,

Could you clarify what you mean by siled scale fixed fee?

I think it would be adequate to have a long term policy to deal with this issue, perhaps peg the fee to some index like how much xem needed to buy 1MB of hard drive or similar, real world cost.

My 2 Xem.

#7

Not only that, having a multisignature account is really expensive, more fees for having a MS account, the other day 16 XEM fee for sending 800 XEM, thats like 2$ fee for sending 80$. what are we? Western union?

#8

The price has gone up quite a bit and they have not adjusted the fees. They will eventually. I suggest using a multisignature account only for large quantities, and leave the small transactions for a smaller wallet.

#9

The sooner they decrease the fees, the better - especially now as more new people are thinking about buying XEM than ever.

#10

It’s being worked on. :wink:
We might get an official statement on that rather sooner then later.

1 Like
#11

sorry I mean “sliding” so the fee can change according to usage and block fullness, such that stake reward can both increase for finding a block and fees go down as more people use the block and price goes up, thus optimize a minimum, of course this hits a hard limit at blocksize or equivalent.

Put simply tethered to a usd amount that is very low as much as possible to account for increasing price