Virtual Byte (vByte)

A virtual byte (vByte, or vB) is the unit used to measure a Bitcoin transaction's size for fee purposes after the SegWit upgrade. It exists because SegWit changed how transaction data counts toward the block limit: witness data is discounted, so a raw byte count no longer reflects how much block space a transaction actually consumes. The vByte gives everyone — wallets, miners, fee estimators — a single, fee-relevant size number to reason with.

The conversion

One vByte equals four weight units. Under SegWit's accounting, non-witness transaction data weighs 4 units per byte while witness data (signatures and scripts in the witness) weighs only 1 unit per byte — that is the famous witness discount. Since a block's ceiling is 4,000,000 weight units, the network's effective capacity is 1,000,000 vBytes per block. To get a transaction's virtual size, take its total weight and divide by four, rounding up. For a legacy, non-witness transaction, vBytes and raw bytes are numerically identical; for a SegWit transaction, the discounted witness portion pulls the vByte count below the raw byte count, which is precisely why SegWit spends are cheaper for the same logical payment.

Why miners and users care

Fee rates are quoted in satoshis per vByte (sat/vB), which is the figure your wallet shows when estimating a fee and the figure every mempool visualizer charts. Because miners maximise total fees within a fixed weight budget, the transactions that win block space are those offering the most sat/vB, not the most satoshis in total — a small high-fee-rate transaction outbids a large low-fee-rate one every time. This is also how block template construction connects to a miner's revenue: a well-built template is simply the highest-value packing of the 4-million-weight-unit knapsack, measured in exactly these units.

Practical sizing intuition

Understanding vBytes is essential when sizing a coin selection or a consolidation: every input you spend adds its own bytes of outpoint, script, and signature data, so spending many UTXOs inflates your vByte count and therefore your fee, while SegWit and Taproot inputs keep the witness discount working in your favour. Rough orders of magnitude help planning: a simple one-input, two-output SegWit payment lands in the low hundreds of vBytes, while a consolidation sweeping dozens of inputs can run into the thousands — which is why consolidations are best broadcast when fee rates are low and why keeping a wallet full of dust-sized UTXOs is expensive deferred maintenance. The dust limit itself is defined in these terms: an output is dust when spending it would cost more in vByte fees than the output is worth. In our day-to-day work, sat/vB is the number we watch to decide whether a broadcast confirms quickly or sits in the mempool — and vBytes are the denominator that makes that number meaningful.

vBytes on the mining side

Miners meet the same arithmetic from the other direction. Pool and firmware dashboards may express template quality in fees per weight, and the difference between a mediocre and a well-constructed block template — better transaction selection within the same 4-million-weight budget — flows straight to revenue during high-fee periods. This is also why fee spikes disproportionately reward miners who keep their node and template pipeline healthy: when the mempool backs up, the marginal sat/vB of the last transactions packed into the block rises sharply, and sloppy templates leave money in the mempool. Whether you are a wallet user timing a consolidation or a miner auditing template quality, the vByte is the common denominator — one unit that ties fee markets, block construction, and wallet hygiene into the same ledger of scarce space.