> For the complete documentation index, see [llms.txt](https://docs.leather.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.leather.io/learn/what-is-bitcoin-fee-estimation-and-how-does-it-work.md).

# What Is Bitcoin Fee Estimation And How Does It Work?

Fee estimation picks a Bitcoin fee rate that gets a transaction confirmed in time without overpaying. The methods and how to work out a fee.

Fee estimation suggests a fee rate that gets your Bitcoin transaction confirmed in the time you want, without overpaying. The fee depends on the transaction's size and on demand for block space, not on the amount you send.

## Fee rate and size

* The **fee rate** is the price per unit of block space, in satoshis per virtual byte (sat/vB).
* The **size** in virtual bytes grows with the number of inputs and outputs, and depends on the address type.
* **Fee = size × fee rate.**

## Estimation methods

* **Mempool-based:** looks at the transactions waiting in the mempool and the fee rates the next blocks will likely need. It reacts quickly to changes in demand.
* **History-based:** looks at the fee rates that got transactions confirmed in recent blocks. Bitcoin Core's estimator works this way. It suits payments that are not urgent.

## Work out a fee

For a Native SegWit transaction, an input is about 68 vB, an output about 31 vB, and the fixed part about 11 vB.

Example: 2 inputs and 2 outputs (payment and change) are about 11 + 2 × 68 + 2 × 31 = 209 vB. At 10 sat/vB, the fee is about 2,090 sats.

![Fee rate options for a BTC send](https://4209755586-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FaSQhveafXrLjROsW3JZ1%2Fuploads%2FHlUU07Y0aw4bE1PGuSGF%2Fe-support-what-is-bitcoin-fee-estimation-and-how-does-it-work-01-btc-choose-fee.png?alt=media\&token=625caa73-5135-4ee7-8f76-e55c73991d33)

## Pay less

* Send when the mempool is quiet, such as weekends, if the payment is not urgent.
* Use Native SegWit or Taproot addresses: their inputs are smaller.
* Combine small coins into one when fees are low, so later transactions have fewer inputs.
* Choose a lower fee option when you can wait. If it waits too long, raise it with Replace-By-Fee.

## Fee estimation in Leather

Leather gets current Bitcoin fee rates and suggests three options, from slower and cheaper to faster. You can also enter a custom fee rate. See [Configure Transaction Fees](/transactions/configure-transaction-fees.md).