Fees on the Cardano network

A fees system on public blockchain networks is a big topic. Different projects have their own strategies. We will provide a basic overview. Then, we explain different points of view in this article with respect to the present and future of fees on Cardano.

Why fees are important

There is always a price to pay for good service. If you don’t pay anything, the other party probably has some other benefits arising from the service. Perhaps these benefits are not obvious at first glance and the counterparty tries to keep them secret. Bank accounts and transactions used to be paid for. Today, bank customers in many countries do not pay the fees, or the price has gone down significantly. Public blockchain networks offer people an alternative financial system. To make this alternative user-friendly, the amount of fees is one of the deciding factors.

You can look at public blockchain networks, including Cardano, as a company with its own economic model. Cardano needs to have revenue in order to have expenses. Fees, along with coins that have yet to enter circulation through monetary expansion, are revenue. The Cardano network needs to pay for its security, decentralization, maintenance, and development. Cardano is a somewhat autonomous mechanism that behaves according to fixed rules that are embedded in the project’s source code.