From Mining to Markets: The Evolution of Bitcoin Transaction Fees

@article{Easley2019FromMT,
  title={From Mining to Markets: The Evolution of Bitcoin Transaction Fees},
  author={David A. Easley and Maureen O'Hara and Soumya Basu},
  journal={Monetary Economics: International Financial Flows},
  year={2019}
}
Abstract We investigate the role that transaction fees play in the bitcoin blockchain's evolution from a mining-based structure to a market-based ecology. We develop a game-theoretic model to explain the factors leading to the emergence of transactions fees, as well as to explain the strategic behavior of miners and users. Our model highlights the role played by mining rewards, transaction fees, price, and waiting time, discusses welfare issues, and examines how microstructure features such as… 
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