Bitcoin Request for Comment (BRC-20) standard tokens and the rising popularity of the Ordinals Protocol have fueled block demand, pushing transaction fees on the Bitcoin blockchain to two-year highs.
Average transaction fees on the Bitcoin network hovered at just under $20 on May 8, European time, up sharply from $1.20 last week. Such levels are the first since May 2021, when the price of Bitcoin (BTC) hit $60,000.
Data from Dune Analytics show that NFTs tied to the Bitcoin blockchain, mostly text-based, surged past 3 million last week.
Bitcoin NFTs, called inscriptions, work on the Ordinals Protocol. Ordinals allows users to embed data into the Bitcoin blockchain by marking references to digital art into small Bitcoin-based transactions.
The BRC-20 standard allows users to issue transferable tokens directly through the network, fueling the popularity of digital artwork and meme tokens built on the Bitcoin blockchain.
As of May 8, more than 11,000 tokens issued on the Bitcoin blockchain were available on the open market, with a market capitalization of $1.6 billion, according to OrdSpace, which tracks data on BRC-20 tokens. (approximately 216.33 billion yen).
Meanwhile, some analysts see the rapid increase in transactions as a sign of widespread adoption of the Bitcoin blockchain.
“At the peak of 2019, most Bitcoin transactions were skewed in the $1,000 to $10,000 range,” ETC Group head of research Tom Rodgers told CoinDesk in an email. Says.
“This shows that most Bitcoin users used the Bitcoin blockchain for trading. Less than $1, which indicates a significant increase in bitcoin velocity, the amount of bitcoin traded by users rather than being held in cold wallets for the long term,” Rogers said. added.
While bitcoin is active, network congestion briefly caused problems for cryptocurrency exchanges such as Binance, which suspended bitcoin withdrawals twice over the weekend.
As of this writing, there are nearly 415,000 outstanding Bitcoin transactions, according to on-chain data. This surpasses numbers seen during the 2018 and 2021 bull markets.
｜Translation: coindesk JAPAN
｜Editing: Toshihiko Inoue
｜Original: Block Demand Leads to Fee Spike as Bitcoin-Based Memecoins Flourish
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