The dark side of the cryptocurrency: understand the impact of the transaction rate on its profits

The cryptocurrency has changed the way we think of transactions and financial transactions as a whole. With digital currencies such as Bitcoin, Ethereum and others, investors and merchants have been able to use new investment opportunities that were not previously available.

However, one of the biggest challenges faced by cryptocurrency investors are transactions. The transaction rate is the accusation charged to process cryptocurrency exchange transactions in the Blockchain network. These rates can vary from a few cents for an agreement to hundreds of dollars for trade, which makes it difficult for a merchant and a merchant experienced in this room.

What causes a transaction rate?

The transaction rate is caused by several factors that include:

1
Network congestion : When more transactions are made in the Blockchain network than can be processed in real time, it needs a position to stimulate miners to confirm new business blocks.

2
High computer power : The new block chain needs a significant amount of computer power to solve complex mathematical problems and create a valid block chain. As the number of users increases, computer capacity is also increasing, causing a higher transaction rate.

3
Centralized exchange rates : Trade with centralized values ​​exchanges (CEX) may be higher than those imposed by the pairs bag of pairs to equal (P2P).

• Exchange commissions : Some exchanges of values ​​collect additional rates for services such as buying and selling, eliminating and depositing.

The impact of the transaction rate on profitability

Transaction rates have a significant impact on cryptocurrency profitability. Here are some reasons why:

1
Reduction of earnings rates : As the transaction rates obtain in their profits, it is becoming increasingly difficult to obtain profits, even if you are obtaining a good contribution to performance.

• Increased commercial cost : higher transaction rates can increase commercial costs by reducing the attractiveness of investment in cryptocurrency.

3
Limited liquidity : lower transaction rates can limit the number of transactions that can be executed at the same time, further limiting liquidity and making cryptocurrency trade difficult.

As a transaction rate it affects several commercial strategies

The transaction rate can affect a variety of commercial strategies that include:

1
Long -term investments : Investors who cling to coins for a long time may need to accept higher rates for transactions.

• Daily trade : Short -term merchants are often attacked by market fluctuations and high transaction rates can be less affected.

3
Speculative trade : merchants involved in speculative activities, such as low -sale construction, may be more difficult to benefit, since the highest costs are related to transaction rates.

Reduction of the transaction rate

Consider the following strategies to reduce the impact of the transaction rate on your profits:

1
Use the P2P exchange : uniforms can often collect lower rates than centralized exchange.

• Select a low cost or free exchange : Choose an exchange that charges competitive rates for buying and selling cryptocurrencies.

3
Consider using cryptocurrency wallet : cryptocurrency wallets can help reduce transaction rates, allowing you to transfer coins directly between the accounts without involving the network.

Conclusion

The transaction rate is an important obstacle to the cryptocurrency space that affects profitability and commercial strategies. Understand the causes of the transaction rate and the influence of various commercial strategies, investors and merchants can make conscious decisions about their investments.