Fee Markets and Congestion (High-Level)

From the outside, blockchain transactions can feel inconsistent. One day a simple transfer confirms in seconds with a small fee, and another day the same transfer with the same wallet sits as “pending” for minutes or even longer, sometimes with a much higher fee. Most people are used to apps where prices and waiting times are fairly stable. Paying for a ride, streaming a video, or sending money through a bank usually feels predictable, so it is natural to expect the same from blockchain transactions. The main source of confusion is that, on a blockchain, outcomes change a lot depending on how many other people are trying to use the system at the same time, not because of a personal mistake or a broken wallet.

When blocks are not full, almost any reasonable fee can be included quickly because there is plenty of space. Once blocks start to fill up, not every waiting transaction can fit, so some must be chosen before others. In this situation, the fee attached to a transaction acts like a signal of how urgent it is. Transactions offering higher fees are usually more attractive to whoever is assembling the next block, so they tend to be picked earlier. This creates a fee market: transactions are effectively competing for a shared, limited resource (block space), rather than buying a guaranteed service from a single company. This is not a direct auction against other people, but a decentralized signal system where each transaction independently expresses its priority. There is no central auction or price setter — the “market” emerges from many individual transactions expressing priority at the same time.

When the network is busy, many valid transactions can be waiting across several blocks. In this crowded situation, even two transactions with similar fees might be included at different times, depending on what other transactions appear before and after them. A status like “pending” usually means the transaction is in limbo: it has been broadcast and is valid, but it has not yet been included in a block. It may eventually be included once there is space and its fee is competitive enough, or it may be left out and treated as if it expired if it waits too long or is consistently outcompeted.

Exact labels and behavior vary by blockchain and explorer, but the underlying idea is the same: only included transactions receive a final outcome. This is why “pending” is a temporary visibility state, not a guarantee of inclusion — mempools are local and inclusion is competitive.

In a shared system with limited capacity, busy periods naturally lead to higher prices and longer waits. Blockchains are no different: when many people try to transact at once, fees rising and confirmations slowing down are expected behaviors, not automatic signs of failure. This does not mean every situation is perfect, but it does mean that strange-looking outcomes during busy times often reflect competition for a crowded resource rather than something being broken. Understanding this helps separate normal congestion effects from truly unusual problems that might need deeper attention.

Imagine a small theater that runs shows every few minutes. Each show has a fixed number of seats, just like each block has a fixed amount of capacity. People arriving at the theater are like transactions being sent to the network. When it is quiet and only a few people show up, everyone gets a seat easily and there is no need to pay extra for priority. When a popular show starts and a large crowd arrives at once, not everyone can fit, so the theater might let people pay more for a priority line. In that crowded moment, small differences in what people are willing to pay decide who gets into the next show and who has to wait for later ones. This model explains why fee markets feel unpredictable during congestion, even when nothing is "broken".

Feeling puzzled by fee spikes, slow confirmations, or pending transactions is very common. A simple mental model of limited block space, competition during busy times, and fees as priority signals is usually enough to make these situations feel more understandable. Most confusing behavior during congestion reflects many people sharing the same limited resource, not personal errors or lost funds. With this picture in mind, changing fees and timings become expected patterns rather than alarming surprises.