Bitcoin transaction fees rise roughly 300% as NFTs take up more block space
The rise of bitcoin (BTC) ordinals NFTs has seen transaction fees rise by 300% to around $0.77, on-chain data shows.
Bitcoin fees rising as NFTs become popular
Trackers reveal that the average transaction fees on the Bitcoin network from $0.77 on Jan. 29 to $1.95 on Feb. 10. January also recorded a higher median fee price range of $0.73.
The spike coincides with the rising popularity of the from the Ordinals NFTs.
Ordinals project functions by assigning metadata to Satoshis. Subsequently, it maintains the uniqueness of the art and ability to be transacted from one address to another. This functionality came on the network following its 2017 SegWit update and 2021 Taproot Upgrade.
Bitcoin NFTs turning heads
Bitcoin NFTs are becoming a thing a significantly fast way. A BitMEX study shows that over 10,000 NFTs were created on the network between Dec. 14 and Feb. 7, claiming 526 megabytes of block space. In the process, 6.77 BTC was spent on Ordinals-related transactions forcing up the value of NFTs.
The creators of major NFT collections, including Bored Ape Yacht Club (BAYC) and CryptoPunks, have started uploading their artwork on Bitcoin. However, the move, especially of BAYC artworks being stored in Bitcoin, isn’t officially sanctioned by Yuga Labs, the team behind the BAYC NFTs.
Although Ordinal NFTs is driving activity in the Bitcoin network, the rise of transaction fees can, as history show, impact user experience.
Bitcoin is transactional and doesn’t have smart contracting capabilities, like Ethereum. As such, users can only use it to transfer value trustlessly across the globe without a third party. However, the newly found way of hosting and trading NFTs might cause not only fees to increase but lead to congestion.
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