What is the "Network Fee", and why we charge it?

What is "Network Fee"?

Miner fees on the Bitcoin blockchain (known as Gas fees on Ethereum blockchain, which includes all ERC-20 tokens such as USDT) are small amounts of Bitcoin given to incentivise bitcoin miners (and their operators) to confirm Bitcoin transactions. Mining fees go to the miners which in turn allow the entire blockchain to run in a decentralised manner. Miner fees occur every time a new transaction is created on the blockchain, and are paid by the sender of the transaction. Please notice, miner fees do not go to Orbital.

When your customer sends coins to a wallet address provided by our platform, those coins go in to a dedicated wallet address specific for that customer. This is what enables us to reconcile transactions in real time, and eliminate any edge cases. When coins reach each of those dedicated wallets, our system immediately sweeps those coins away from the individual wallet in to a larger wallet dedicated to the merchant, from which payouts or withdrawal/settlements can be sent.

We pay blockchain network-based miner fees (like your customer does to send the transaction) to sweep and combine the different cryptocurrency amounts paid to the various wallet address provided (a "UTXO sweep"). We refer to those fees as the "Network Fees", which get deducted from the gross amount received during any given transaction.

The network costs (mining/gas fees) change based on the blockchain network conditions of the currency involved, and so the "Network Fee" also changes dynamically from transaction to transaction.

How does Orbital apply the "Network Fee" to Merchants ?

For all the cryptocurrency based transactions, Orbital will apply "Network Fee" (which goes to the miners) on top of Orbital Fee. The Network Fee will be deducted from the gross amount received for any transaction.

Orbital applies the "Network Fee" in exactly the same way it is paid to the blockchain, and does not add any additional mark up on of the Network Fee.

Both the Network Fee and Orbital Fee will be applied against the Merchant Balance which Orbital holds in the system.

Can the "Network Fee" be passed onto the merchant's End-Users ?

Please note it is entirely the merchants decision whether to pass on the Network Fee to their End-User or absorb the fee by themselves. While it is possible to pass on the Network Fee to customers, in order to provide a great user experience for your customers we suggest merchants to absorb the cost of Network Fee themselves. This enables lower cost of deposit for your customers making crypto deposits an even more attractive option and improves customer satisfaction.

For Deposits:

Generally a merchant will be receiving a cryptocurrency payment in lieu of a deposit to a cashier balance in another currency. In case you decide to pass on the Network Fee to your customers, we suggest deducting this Network Fee cost from the net converted amount which get's credited to the customer's balance, you can find the correct amount to deduct from the customer balance on the payment object that is created for each deposit, under the fees section as networkFee.

For Withdrawals / Payouts:

The Withdrawals / Payouts API has an optional parameter that can be used for deducting the current network fee amount from the amount being sent to the customer / external wallets. In order to use it, simply pass the the feeCoverage parameter as true when requesting a new withdrawal / payout creation.

For more details please refer https://api-docs.paymero.io/?version=latest#7210c3b5-a0cb-4aa4-befa-0373418ea71e

How can Merchants identify the "Network Fee" dynamically before processing the Deposit request?

Orbital has a dedicated API end-point to fetch the "Network Fee" details, from the blockchain network, which merchants can make use off.

For more details: Please refer https://api-docs.paymero.io/?version=latest#45931316-e5be-4b91-8017-043c7b7d365f

We suggest that the merchant use this API endpoint to calculate and display the appropriate Network Fee to their customers, if they choose to deduct if from the end-users deposit. The merchant should use this network fee when calculating the amount to credit the end-users balance.

How does the "Network Fee" affect payouts?

Orbital also incurs a mining/gas fee (Network Fee) for creating and sending cryptocurrencies as payout requests to customers.

When a payout is requested with default parameters, the payout will be made for the full amount as requested by the merchant in the payout request API call, with the "Network Fee" component being deducted from the merchant's balance (along with the Orbital processing fee). If the merchant does not hold enough balance to cover all the transaction amount, and the Network Fee, and the Orbital processing fee, then the payout transaction would fail. In this case, sending a $10 payout when current network fees are $1, would effectively send $10 to your customer and in total the Merchant Balance would be charged $11.

When a payout is requested with the feeCoverage parameter as true, the payout will be made for the amount requested by the merchant deducted by the current network fee costs for creating this transaction. In this case, sending a $10 payout when current network fees are $1, would effectively send $9 to you customer and in total the Merchant Balance would be charged $10

What if the "Network Fee' is too high?

As described above, the Network Fee is dynamic and goes up or down depending on the network conditions on the blockchain at the time of the transaction. If the blockchain is congested, the (Network Fee) cost will be higher. There have historically been cases where the mining/gas fee on the Bitcoin & Ethereum blockchains has spiked to over $5 equivalent per transaction. In the case of ERC-20 tokens, the fees could be even higher as they require one Gas fee to be in the wallet in the first place, which requires more Gas to put there.

When the Network Fee is as much as $5 or higher, a $10 payment may be uneconomical for most people. In cases like these, when the blockchain is congested, we suggest end-users use an alternative cryptocurrency with lower fees to make the payment - for example USDT TRC20 that operates on Tron Network.

From the merchant perspective, we suggest encouraging your end-users to either wait till the fees come down, or to send larger amounts where it is still economical.

's system is dynamic in that it calculates the Network Fee based on live conditions of the blockchain at the time, and will go up and down accordingly.