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Consulting Request

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William

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Posts: 308

Hello,

I will pay 1500 LTBcoin to each of the first two people who submit me detailed, appropriately cited answers to these questions:

“The amount or range, denominated in BTC, that a person (X) would pay in sending BitCoin purchased from CoinBase.com, to a wallet belonging to another person (Y) on a cellphone app like Mycelium, combined with the transaction fees that this person (Y) would pay in sending those BTC to a third wallet (Z). What are the factors that influence the total transaction fees of X->Y->Z? Do the transaction fees depend, for example, on the wallets (Mycelium) and exchanges (CoinBase) used or the amount being transferred?”

This will be open-source consulting. Please respond on this thread, for the benefit of future researchers and the community's peer-review. I would like to have a payment mechanism whereby I pay the two people whose answers have the most up votes one week from today, July 13. If this is not possible, I will go with the first two complete answers that are posted.

Thanks,

William

Posted on July 6, 2014 at 12:15 PM
Last Edited: July 6, 2014 at 5:13 PM

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• adam

  

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  Posts: 1980
  Location: California, USA

  +1 on this, good question and excellent initiative.

  Posted on July 6, 2014 at 12:27 PM
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• impulse

  

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  Posts: 6
  Location: USA

  That is a great idea. You could have a Yahoo Answers type section of this forum, for people to ask cryptocurrency related questions, and the best answers would be rewarded with LTB Coin.

  Posted on July 11, 2014 at 3:06 AM
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• furezasan

  

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  Posts: 83
  Location: United Kingdom

  @impulse That is a great idea. You could have a Yahoo Answers type section of this forum, for people to ask cryptocurrency related questions, and the best answers would be rewarded with LTB Coin.

  Yeah that'd work really well for newcomers to the network as well...

  Posted on July 11, 2014 at 3:09 AM
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• RockHoward

  

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  Posts: 76
  Location: Austin TX

  Fee Analysis

  Purchasing BTC via coinbase

  The cost for a nominal purchase is 1% of the transaction amount (in USD) rounded up to the nearest 1 cent plus the cost of the bank fee which is typically (or at least in my case) 15 cents.

  Therefore purchasing $50 worth of bit coin costs $50.65. Fifty dollars is converted to BTC at the then offered buy price. Fifty cents is the 1% fee and 15 cents is the bank fee.

  (Notice that the buy and sell price at coinbase are different, but usually they are within 50 cents of each other. In times of high volatility that spread can expand quite a bit.)

  There are options in coinbase to use a credit card to get funds in faster, but this can be treated by your bank as a cash advance and so can incur higher bank fees. I have never used that option myself.

  Sending BTC from coinbase to Mycelium

  This is free since coinbase eats the miner’s fees on all outbound transactions of at least 0.01 BTC.

  Sending BTC from Mycelium to Another Wallet:

  Mycelium insists on tacking on a 0.1 mBTC miner’s fee to all outbound transacfions.

  Totals

  1% in USD + 0.15$ bank fee + 0.0001 BTC miner’s fee for mycelium to 3rd party.

  Example

  Assuming $625/BTC exchange rate and a $50 purchase:

  • $0.65 or 0.00104 BTC for coinbase and bank fees
  • $0.06 or 0.0001 BTC for miner’s fee for mycelium transaction

  Result:

  • (USD) $0.71 for $49.94 transfer of value to the final destination.
  • (BTC) 0.00114 for a transfer of 0.0799 to the final destination.

  Sources

  My personal records as I use this exact setup. I acquire $50 of BTC every week using a recurring coinbase purchase. I keep my balance on coinbase very small (usually 0 BTC) and instead move the coins to one of my personal wallets. I keep $25-$40 worth of BTC on my Mycelium wallet on my cellphone. The rest is in a computer wallet (Electrum) or in cold storage (paper wallet).

  I cannot comment on alternative setups or wallets as I have not used them and I have taken up enough of my time on this reply.

  Hope that helps!

  Posted on July 19, 2014 at 4:40 PM
  Last Edited: July 19, 2014 at 4:45 PM
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• William

  

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  Posts: 308

  @rockhoward

  Excellent, detailed, well-written response! I sent the entire 3,000 LTB bounty to 1Fi3SYFrwhhCoBNbSUoaRApuHtEF4Jirko and am now closing this request. One followup question: is the Mycelium fee constant, regardless of the transfer amount? Thanks again, and you should consider writing an article or two here (maybe you already have?). You have the skills!

  Posted on July 19, 2014 at 6:16 PM
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• RockHoward

  

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  Posts: 76
  Location: Austin TX

  Yes. It is a constant 0.1mBTC regardless of transaction size.

  Thanks.I am glad this was useful.

  Posted on July 19, 2014 at 6:48 PM
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