Sats/vB Meaning

What Is Sats/vB?

Spending Bitcoin from your Bitcoin wallet has no specific set transaction fee. Instead, the transaction fees are largely determined by two factors: the size of the transaction data, and users’ demand for blockspace. This means that larger transactions and transactions made during times of high network demand carry larger fees. This Bitcoin fee is used to incentivize the miners in the network to validate transactions. Thus, the transaction fee shows us what users are willing to pay miners to prioritize their transactions at any given time. 

Before the Segwit upgrade, the Bitcoin fee rate was measured in satoshis per byte. However, after the Segwit fork, it is expressed in satoshis per virtual byte, short for “sats/vB” or “sats/vByte.” 

Therefore, sats/vB refers to the fee rate for a transaction to be added to the Bitcoin blockchain. The “virtual byte” in sat/vB denotes the transaction’s weighted size. In turn, that is used to determine the “blockweight” required to confirm the transaction. hence “virtual bytes.”

Sat/vB typically measures the priority of an unconfirmed or pending Bitcoin transaction in a node’s mempool. Put another way, selecting a higher sat/vB when sending BTC typically results in faster transaction confirmation times. The fee rates are typically displayed on blockchain explorers, such as mempool.space.

Simply put, the total fee a user pays for a Bitcoin transaction is the product of the transaction size (in virtual bytes) and this fee rate (sats/vB). For example, if a transaction has 1000 virtual bytes and a fee rate of 40 Sats/vB, the actual transaction fee is 1000 * 40 = 40,000 Sats. This is equivalent to 0.0004000 BTC.