Bitcoin Transaction Fees Surge Nearly 1,000% Since August Due to Ordinals Comeback
The resurgence of Bitcoin Ordinals and BRC-20 has propelled transaction gas fees to skyrocket, directly benefiting cryptocurrency mining companies.
Bitcoin Transaction Fees Surge Nearly 1,000% Since August Due to Ordinals Comeback
Bitcoin transaction fees have reached their highest levels since the meme coin frenzy in May 2023, driven by the resurgence of Bitcoin Ordinals and BRC-20 tokens.
Back in August - during a lackluster sideways market and when "BRC-20" was seemingly fading away - Bitcoin transaction fees were as low as $0.64. Today, that figure has surged approximately 970%, recording $6.84.
Average Bitcoin transaction fees over the past 6 months. Source: BitInfoCharts (09/11/2023)
Typically, blockchain fees rise when there is high demand for transactions and blockchain usage. Similar to Ethereum, gas fees increase and network congestion occurs when a particular project gains popularity, attracting users for experiences, NFT trading, and airdrop activities.
The story echoes in the Bitcoin blockchain. According to digital asset management firm 21Shares, nearly 1.9 million Inscriptions were uploaded to the chain in the past two weeks, indicating a significant surge in demand.
Number of Ordinals Inscriptions on the Bitcoin network. Source: Compiled by 21.co on Dune Analytics
CryptoSlam data also shows Bitcoin leading in NFT trading volume (excluding wash trading) in the last 24 hours, surpassing Ethereum - traditionally dominant in the NFT ecosystem.
The resurgence of Ordinals is partly attributed to Binance recently listing ORDI, the first BRC-20 token on its exchange.
With Binance's reputation and ORDI's price continuously rising since its listing, users are now refocusing on Bitcoin NFTs, intensifying on-chain minting activities and driving up gas fees.
An analyst from 21Shares explained:
“While Ordinals currently play a limited role in the memecoin segment, their explosive growth affirms demand within the Bitcoin blockchain space.”
Furthermore, increased gas fees directly contribute to profits for BTC mining companies, as transaction fees now constitute approximately 8.5% of their revenue. This figure is expected to rise further with Bitcoin Halving 2024 approaching.
Also on the morning of November 9th, in Vietnam time, BTC officially surpassed the $36,000 mark and is exploring new highs for 2023.
