Tuesday, April 24, 2018 6:11:39 PM
Now, when I send you this 1 bitcoin.. Since I don't have an output that evenly adds up to 1.0 I end up having to send my entire balance of 1.09 bitcoin, but I send 0.09 - X, back to myself as "change." Whatever X ends up being is the amount that would be offered to the miner for fees.
The "fee market" in Bitcoin becomes extremely problematic when the network is bogged down, as it was a few months ago, I mentioned there were over 250,000 unconfirmed transactions at a given time. That means, if I needed to send you this bitcoin, immediately I would have to compete with the highest bidding fee to get a miner to actually include it in their next block.
So basically fees are totally dynamic and dependent on how big your transaction is in bytes (and the size of your transaction varies based on how many outputs are used), and it also depends on how bogged down the network is. Hypothetically, if the mempool was completely empty, you could send a transaction with 0 fees, and a miner would pick it up because they have no reason not to. They are incentivized to mine that block because they currently get a 12.5 bitcoin block reward.
Since fees are so dynamic, a lot of wallets have their own implementations of how they deal with them. For example, a wallet that offers little control over fees would not make it possible for you to send a transaction with priority during a period when the network is bogged down, because it would just be determining what it considers to be a "reasonable" fee, without taking into account what the current network state is like, and what the average txn fee is.
....
So the point is, if you use a HD wallet and an xpub (meaning your customers receive a unique address each time they pay for something so that you can link an address to a user), and say your business is something where you charge a small $ amount for subscriptions to your service.. You could potentially have a TON of address with a ton of small bitcoin values. When the time comes that you want to spend that money, you have no choice but to send from each and every one of those outputs, thus making your txn bigger and bigger and bigger, and thus making your txn less attractive for a miner to include in a block. In BTC, they have an extremely limited block size, so they can only fit so many txns and each txn = a fee, so if they were to just include your single big huge txn, then they'd be missing out on fees, so you have to offer a decent fee to cover the size of your txn...
I hope this was educational for you.
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