Crypto group tries to recoup fees after constitutional candidacy failure

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The more than 17,000 cryptocurrency enthusiasts who collectively funded a losing $ 40 million bid to buy a copy of the U.S. Constitution last week face a new hurdle in getting their money back: transaction fees.

How it works: The ConstitutionDAO group used Ethereum to build its war chest, and contributors paid essentially “gasoline charges”, network transaction costs that observers estimated at around $ 50 per transaction.

It didn’t mean much to big budget participants, but took a big bite out of small contributors. The median contribution size was just over $ 200, according to the ConstitutionDAO website. Offer participants collectively spent nearly $ 1 million on gasoline costs, according to one estimate.

The catch: Organizers announced over the weekend that they would return Ether contributions from contributors, but each attendee would have to pay an additional gas charge for this new transaction.

Between the lines: Transaction costs have long been the bane of all manner of monetary and payment innovations and are one of the reasons micropayments have never taken off.

Crypto proponents point out that credit card schemes always take 2-3% per transaction.

What’s next: Ethereum plans to streamline its system in a way that lowers transaction costs, as a host of new systems compete to take its place with blockchain systems that are more efficient and less expensive to run.

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