By Tofiq Aliyev
On Oct 28, 2020
Bitcoin displays a significant price increase, and this increase does not pass by transaction fees. As a result, transaction fees tripled.
Bitcoin becomes the center of attention in the crypto world in recent days. The main reason was the massive increase in the price of Bitcoin. The price increase brings forward the new consequences to the market, and users have to experience those changes. According to the BitInfoCharts, the average transaction fee increased from $3.5 to $10.20. Such high transaction fees were around on 2 February 2018. Bitcoin had two figure transaction fees from the end of 2017 till February 2018, which was after Bitcoin forked into Bitcoin Cash and Bitcoin Core. Increasing transaction fee proves the increasing interest in Bitcoin.
The increase in the transaction fee also caused some disruptions. Due to the increase in the transaction fee, some transactions were stacked and were not verified by the nodes. The level of unconfirmed transactions is at its high since the end of 2017. According to the Mempool data, the total number of unconfirmed transactions is 125k, which was recorded in December 2017. The reason for that the increasing number of transactions between users. If they want their payment to be executed early, then they pay a high amount of transaction fees. Every user wants to benefit from the increase in the price. So, this trend can continue for a while.
If we compare the transaction fees of two major cryptocurrencies, then we will notice some trends. According to the data provided from Messari, we can see that the total transaction fee at Ethereum is decreasing, and at Bitcoin increasing recently. The high transaction fee at Ethereum was due to the stablecoins and the DeFi because the main DeFi projects are on Ethereum. Bitcoin surpassed Ethereum on 22 October, and it excelled even further on 26 October. Now the total transaction fee for Bitcoin is $2.68m, for Ethereum is $1.27m. We can suppose that if Bitcoin continues strong as it is now, this number will go so much further.
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