Ethereum: Decoding the Transaction Amount with Fees

When using the sendtoaddress API call on Ethereum, one common challenge arises when dealing with transactions. The issue is that you’re not specifying the full transaction amount, which includes the fees associated with sending coins from your wallet to a recipient’s address.

In this article, we’ll explore how to calculate and deduct fees from the transaction amount using Ethereum’s native APIs.

Understanding Transaction Types

Before diving into fee deductions, it’s essential to understand the different types of transactions on Ethereum. There are two primary transaction types:

• Basic Payment Transaction (BPT): This is a type of transaction that sends a specific amount of coins from one wallet address to another.

• Send-to-Address Transaction

  

  : This type of transaction allows you to send coins from your own wallet to a recipient’s Ethereum address.

Calculating the Transaction Amount

To calculate the transaction amount, including fees, you can use the following formula:

transaction_amount = basic_payment_amount + (basic_payment_amount * fee_per_bpt)

where basic_payment_amount is the amount of coins being sent, and fee_per_bpt is the fee charged per Basic Payment Transaction.

Example: Calculating the Transaction Amount

Let’s say you want to send 10 BTC from your wallet to a recipient’s address using the sendtoaddress API call. Assuming the basic payment amount is $100 (BTC) and the fee per BPT is 1%, we can calculate the transaction amount as follows:

basic_payment_amount = $100

fee_per_bpt = 0.01

transaction_amount = basic_payment_amount + (basic_payment_amount * fee_per_bpt)

= $100 + ($100 x 0.01)

= $110

In this example, the total transaction amount would be $110.

Deducting Fees with Sendtoaddress API Call

Now that you have the calculated transaction amount, including fees, you can pass it to the sendtoaddress API call along with your wallet address and recipient’s Ethereum address.

Here’s an updated version of the code snippet:

const web3 = require('web3');

const ethers = require('ethers');


// Set your wallet address and recipient's Ethereum address

const fromAddress = '0xYourWalletAddress';

const toAddress = '0xRecipientEthereumAddress';


// Calculate the transaction amount, including fees

const basicPaymentAmount = 100; // BTC

const feePerBpt = 1;

const transactionAmount = basicPaymentAmount + (basicPaymentAmount * feePerBpt);


// Create a new Ethereum wallet object

const web3Instance = new web3.providers.HttpProvider('


// Get the current wallet balance

const fromBalance = await web3Instance.eth.getBalance(fromAddress);

const toBalance = await web3Instance.eth.getBalance(toAddress);


// Calculate the transaction amount, including fees

const gasCost = 1000; // Gas units (approximate)

const transactionFee = 10; // Ether per gas unit


// Create a new transaction object

const tx = {

  from: fromAddress,

  to: toAddress,

  value: fromBalance * basicPaymentAmount,

  gas: gasCost,

  gasPrice: web3Instance.eth.gasPrice,

  nonce: web3Instance.eth.getTransactionCount(fromAddress),

  chainId: web3Instance.eth.net.currentBlock.chainId,

};


// Update the transaction with fees

const updatedTx = await web3Instance.eth.sendTransaction(tx, {

  includeFees: true,

});

In this example, we calculate the transaction amount, including fees, and then pass it to the sendtoaddress API call along with your wallet address and recipient’s Ethereum address. Note that you’ll need to replace your-infura-project-id with your actual Infura project ID.