Ordinal Activity Ramps Pre-Halving with Bitcoin Fees Surge

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With the Bitcoin halving drawing near, there’s been an increase in network demand, mainly driven by a specific group known as Ordinals traders. Consequently, this surge has resulted in higher transaction fees, amounting to approximately 90 satoshis per vByte of block space, which translates to an average transaction cost of around $8.50.

Every day, more ordinary traders are carrying out Bitcoin transactions, with a new record of 162,000 transactions taking place in a single day. This is significantly higher than the average of 90,280 transactions per month. Consequently, the amount of daily fees paid reached an impressive $1.24 million over the past 30 days.

I’ve observed #Bitcoin transaction fees increasing significantly over the past few weeks, with $5 million worth of fees paid yesterday – the most since March 6th. #Bitcoin’s fees have yet to surpass Ethereum‘s in 2024, but this trend might change soon. The upcoming Bitcoin halving could serve as the trigger for this shift.

— James Van Straten (@jvs_btc) April 11, 2024

James Van Stratten, an analyst at CryptoSlate, has been observing Bitcoin transaction fees for several weeks. These fees have started to increase significantly again, and he predicts that Bitcoin’s fees could surpass Ethereum‘s fees for the first time in 2024. He believes that the upcoming Bitcoin halving event might be the trigger for this shift.

The majority of fees in this instance come from routine transactions. However, it’s been suggested that the rise in blockchain trading could be due to anticipation surrounding the upcoming bitcoin halving, which is set to decrease the production of new bitcoins by half.

An additional development is the upcoming introduction of “Runes,” a new digital token standard from Casey Rodamor, the innovator behind Ordinals, scheduled for release on April 19. This new standard may lead to increased transaction fees due to heightened trading activity.

Just like BRC-20 tokens, the introduction of Runes is anticipated by some to lead to significantly increased trading fees, potentially reaching as high as $30 per transaction.

Muneeb Ali, CEO of TrustMachines, expressed that the introduction of Runes coinciding with Bitcoin’s halving will mark the beginning of a memecoin wave on Bitcoin. Due to increasing fees and heightened activity on Bitcoin’s main layer (L1), there is a growing tendency towards utilizing Bitcoin’s secondary layers (L2) instead.

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2024-04-12 09:56