Memecoin hype drives Bitcoin transaction fees to multi-year highs
Bitcoin deal fees surged in early May, reaching their highest point over the past 2 years, according to information from Crypto Fees.On May 3, the total amount of charges paid on the Bitcoin blockchain reached $3.5 million, leaping about 400% from late April. The average Bitcoin transaction cost reached as much as $7.2, according to YCharts.The continuous trading craze of memecoins like Pepe Coin (PEPE) has actually set off an undesirable repercussion for Bitcoin (BTC)– driving its deal expenses to multi-year highs.Total Bitcoin deal fees between May 2021 and May 2023. Source: CryptoFeesThe newest increase in BTC deal costs is mainly credited to a rise in Bitcoin activity including BRC-20 transactions. According to information from Galaxy Research, 50% of all Bitcoin transactions on May 2 were connected to BRC-20 transactions.Modeled after Ethereums ERC-20 token requirement, BRC-20 is an experimental token basic permitting users to provide and transfer fungible tokens on the Bitcoin blockchain. The standard was introduced in March 2023 by a pseudonymous on-chain expert called Domo.The BRC-20 token standard has quickly end up being a significant pattern in the cryptocurrency industry, specifically amidst the sharp development of the PEPE memecoin. The token has actually rallied more than 600% over the past 7 days, reaching its all-time high of $0.00000216 on May 5. PEPE 30-day rate chart. Source: CoinGeckoThe Bitcoin blockchain isnt the only blockchain affected by the continuous memecoin hype. Gas charges on the Ethereum blockchain have actually likewise been increasing to new multi-month highs recently.On May 2, ETH deal fees hit an aggregate quantity of more than $19 million, a level not seen since May 2022, according to Crypto Fees. The Ethereum blockchain remains the most pricey network in regards to deal costs at the time of writing.Related: Bitcoin miners have earned $50B from BTC obstruct rewards, fees because 2010Despite the current spike in Bitcoin deal costs, the current BTC deal expense is still far from all-time high levels. The greatest Bitcoin transaction fees were tape-recorded in April 2021, when the typical BTC deal cost almost reached $70 amidst a significant decline in the Bitcoin network hash rate. The previous highest point in BTC transaction charges remained in 2017, with transaction costs rising above $60. Publication: Asia Express: Justin Suns SUI-farming sins, PEPEs wild run, 3ACs oyster approach
Related Content
Other Questions People Ask
How does memecoin hype drive Bitcoin transaction fees to multi-year highs?
The recent surge in memecoin trading, particularly with tokens like Pepe Coin (PEPE), has significantly impacted Bitcoin transaction fees, pushing them to multi-year highs. As of early May, Bitcoin transaction fees reached $3.5 million, marking a 400% increase from late April. This spike is largely attributed to the rise in BRC-20 transactions, which accounted for 50% of all Bitcoin transactions on May 2, further driving up costs.
What role do BRC-20 transactions play in the increase of Bitcoin transaction fees?
BRC-20 transactions have become a major factor in the rising Bitcoin transaction fees due to their experimental nature and growing popularity. Introduced in March 2023, this token standard allows users to create and transfer fungible tokens on the Bitcoin blockchain. The influx of BRC-20 transactions has contributed to the overall increase in Bitcoin activity, leading to higher transaction costs as demand surges.
Are Bitcoin transaction fees currently at an all-time high due to memecoin hype?
While Bitcoin transaction fees have surged recently, they are not at all-time high levels. The average transaction fee reached $7.2 in early May, but this is still far below the peak fees recorded in April 2021, which approached $70. The current increase reflects heightened activity driven by memecoins but does not surpass previous historical highs.
How does the memecoin craze affect other blockchain transaction fees?
The memecoin hype is not limited to Bitcoin; it has also influenced transaction fees on other blockchains like Ethereum. On May 2, Ethereum transaction fees exceeded $19 million, a level not seen since May 2022. This trend indicates that the excitement surrounding memecoins is creating broader impacts across multiple cryptocurrency networks.
What can we expect for Bitcoin transaction fees if memecoin trading continues to rise?
If the trading frenzy around memecoins persists, we can expect Bitcoin transaction fees to remain elevated or potentially increase further. The ongoing popularity of tokens like PEPE and the associated BRC-20 transactions are likely to keep driving demand on the Bitcoin network. Investors and traders should be prepared for fluctuating costs as market dynamics evolve with the memecoin trend.