Fee rates are calculated dynamically. This calculation dictates the speed at which a transaction is picked up and confirmed by the network.
For example, on UTXO blockchains, the fee rate depends on the number of unspent outputs that are used in the transaction, on its real destination, and on the change remaining from the transaction.
To determine a transaction’s estimated fee rate, Fireblocks retrieves the latest block data and calculates the rate for each fee level.
- High: Fees are based on the previous block’s fee.
- Medium: Fees are based on the average of the previous two blocks.
- Low: Fees are based on the average of the last four blocks.