It's no surprise to many that Bitcoin Core fees have been beyond reason. Throughout these last few months, with a decrease in transactions per second, one can expect to see an average fee of above $0.76. This fee isn't too terribly high by itself, but once one factors in alternatives such as Bitcoin Cash, which has an average fee of less than $0.01, it's very difficult to justify. However, fees become unbearable during peak network use, such as in January, when we saw average fees of about $55.00 at their worst

While BTC has been lagging behind, the traditional banking system has been working desperately to catch back up. We've seen a myriad of pieces throughout the crypto news cycle such as commercial banks trying to implement (and in some instances, patent) blockchain technology in their own systems. But what has most recently caught my eye is a post I saw while browsing one of my favorite crypto communities on Reddit:

The post is a picture of a Western Union advertisement, stating that you can transfer currency using their services for $7.00 at the most. Of course, what's really important is the asterisk next to the word 'fee'. If we take a take a peak at real-world Western Union fees, we can get a better idea of what this asterisk is hinting at.

To transfer any amount of money to a recipient in the United States with Western Union via a bank account, you'll be charged a $0.99 transfer fee. That's about the same amount you'll be paying to transfer BTC now, and there's very little network activity as it is! Granted, if you chose a cash pickup option, you'll be charged a ridiculous $50.00 transfer fee, although this isn't very important, given that there are not many of those in the US who are among the unbanked. Also, if you choose to send a wire via a bank account for that $0.99 fee, you'll have to wait six business days for the transfer to complete, which is much longer than a BTC transaction with the same fee.

International Western Union wire fees are another story, however. In many countries, you can send a wire transfer for a couple of dollars, or in some cases, for free. In others, such as Afghanistan, you'll pay a transfer fee of $50.00. Whether or not BTC (in the network's currently relaxed state) is competitive with Western Union in regards to remittance payments highly depends on the recipient country.

Although BTC isn't competitive with Western Union fee-wise, it's still much faster. This means that BTC is competitive with the traditional banking system in the interim. But how long will this last? If massive amounts of people start to use BTC once again, fees will be significantly higher. If BTC fees reach $30.00 - $55.00 range once again, a lot of people are going to switch to archaic forms of money transfer that, although long in transaction time, are far more reliable, cheaper, and trustworthy than the BTC network in a congested state. Even international remittances to most countries will be cheaper via Western Union.

While BTC is lagging behind in innovation as its developers fail to address the flaws present in its fee model, the banks are catching up. They are increasing their efficiency and cutting their costs. They know cryptocurrency is a threat to them, and they are reacting accordingly. On the other hand, the Core developers have allowed innovation to stagnate while telling the community to wait for the Lightning Network, which is riddled with its own problems and only stands to lay down the framework for banking 2.0. In other words, the ancient powers that be are catching up, but the Core developers are doing nothing to stay ahead.