Leading cryptocurrency exchanges are lowering withdrawal fees for the privacy coin Monero (XMR) as transaction fees are much lower now that XMR has added Bulletproofs to their network.
Bulletproofs, implemented last week, lowers transaction fees on the Monero network.
Withdrawal fees have always been a headache for anyone in the cryptocurrency community.
This was felt particularly acutely with Monero. As its privacy features make transactions bulky, users sometimes have to pay hefty fees to take their cryptocurrencies off the exchanges.
Not anymore. Yesterday, Binance and Bittrex announced that they would be lowering XMR withdrawal fees to 0.0001 XMR. Considering that XMR is currently trading at $107, that 0.0001 XMR translates to a withdrawal fee of only $0.01.
This represents a major discount for traders, who previously paid 0.04 XMR ($4.28) to withdraw from Binance (as shown in Reddit posts here and here). The exchanges’ announcements can be seen in the tweets below:
— Binance (@binance) October 26, 2018
— Bittrex (@BittrexExchange) October 25, 2018
Bulletproofs is an upgrade to the Monero network that reduces the amount of data stored in a transaction.
Cryptocurrency transactions charge the user for the amount of data that the transaction requires, so larger transactions will require more data (and more fees). Monero, whose protocol mixes and hides user data, uses significantly more data than competing cryptocurrencies.
That is, until now.
Bulletproofs reduces the amount of data in the transaction by around 80%, which cuts transaction fees up to 90%.
One week after the fork, fees are still low, signifying that the network’s fees will stay low for a while. As seen below, Monero fees were previously around $0.50, about equal to Bitcoin fees. Now that Bulletproofs has been implemented, XMR transactions are cheaper than Bitcoin, Ethereum, and Litecoin. Via Bitinfocharts:
Despite this amazing upgrade to the Monero protocol, it seems the market has not reacted positively, as the price has remained dormant for days.