blockmindset
Lesson 3 of 510 min

Mempool and Transaction Fees

The mempool is each node's local waiting room for valid unconfirmed transactions.

Why this matters

Fees explain confirmation speed, stuck transactions, replace-by-fee, child-pays-for-parent, and competition for block space.

1

The Intuition

Before confirmation, a valid transaction may sit in a node's mempool. Miners usually choose transactions with the highest fee per virtual byte because block space is limited.

2

See it concretely

Concrete example

It is like airport standby boarding. Many people want limited seats, and priority determines who gets included first.

3
⚠

Tempting — but wrong

4

The precise version

The transaction fee is the difference between total input value and total output value. Feerate is usually measured in satoshis per virtual byte. Nodes apply consensus rules to blocks and local policy rules to mempool relay. Replace-by-fee and child-pays-for-parent are fee-bumping strategies that use policy and miner incentives.

feerate = fee_{sats} / vsize_{vbytes}

Check your understanding

Why can two nodes show different mempools?

Click to reveal answer

Why does feerate matter more than absolute fee?

Click to reveal answer

Before moving on
  • Distinguish consensus validity from relay policy.
  • Calculate feerate.
  • Explain RBF and CPFP conceptually.
  • Explain why confirmation estimates are uncertain.
?Checkpoint

Why do miners prefer higher feerate transactions?

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