Bech32 vs Bech32m Addresses: Which Saves More on Fees?

I’m thinking about moving from Legacy Addresses to SegWit (bech32) to cut down on fees. Seems like it’ll help with congestion too if more people switch. Want to consolidate my addresses when fees drop due to a less crowded Mempool. But what do you all think? Is it worth jumping from SegWit (bech32) to Taproot (bech32m) for even more savings?

From what I’ve seen, SegWit v0 usually has lower fees compared to SegWit v1 (that’s Taproot). But if you need to consolidate, Taproot can actually be cheaper. If you’re sending to a bunch of addresses, like some people do on here, it’s better to stick with v0. But for 1-2 outputs, v0 is still the way to go. Only when consolidating big inputs does P2TR shine.

Great question! Taproot addresses (P2TR) aren’t always cheaper overall. It really depends on the situation some setups might recommend using P2TR. Check out some details online for a deeper dive.

It really varies. Adding a taproot input boosts the transaction size by about 57 vbyte, but bech32 inputs add around 68 vbyte. Outputs? Taproot adds 43 vbyte and bech32 outputs only add 31 vbyte. Maybe check out what Charles-Tim wrote for more.

Yeah but remember, Taproot transactions aren’t always smaller than native SegWit ones. A taproot input is actually 10 vbytes smaller than a native segwit input, but the output is larger. So, if you have lots of inputs and few outputs, taproot can save you money.

SEGWIT lowers fees by using block space more efficiently, separating witness data. We got two types of SEGWIT addresses those starting with 3 (the first kind) and the more common ones starting with bc1 (native). I’ve read plenty of guides on switching wallets but never came across one that explained this clearly.

The OP isn’t talking about the older SEGWIT addresses that start with 3. We’re comparing v0 and v1 directly. V0 starts with bc1q (bech32) and v1 starts with bc1p (bech32m) that’s Taproot.

There's this tool here that’s great for comparing. You can adjust the inputs, outputs, and address types, and it’ll give you the potential savings.

Thanks for that! I thought all bech32 addresses were the same. Can someone break down which type is best for minimizing fees? Like I remember Charles-Tim saying bech32 v0 is better for large outputs. But how does bech32m beat that in consolidation?

Transaction fees depend on how much data you’re sending. V0 has a smaller footprint, so when you have big outputs, it’s cheaper. But for consolidation, v1 can save more since you’re bringing everything together.

Adding any input or output increases transaction size. As pointed out earlier, a taproot input gives you a boost of about 57 vbyte versus 68 for a bech32 input. Consolidating means more inputs, so if those are taproot, you’ll end up saving fees.

Big thanks, especially to Zaguru12 and hosseinimr93, for clearing things up! I’ve got a way better grasp on these addresses now, appreciate it a ton!

Just to add, bech32 and bech32m are different formats that support more witness versions. Bech32 got replaced by bech32m due to some design flaws. In the end, maybe we should be asking "P2WPKH vs P2TR: which one saves more on fees?"