Bitcoin Blockchain's Average Transaction Fees Surged 900% To Stand At $15.65 The primary reason behind this drastic increase is said to be the introduction of Ordinals onto the Bitcoin Network

By Teena Jose

Opinions expressed by Entrepreneur contributors are their own.

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Over the past three months, average Bitcoin transaction fees have skyrocketed by 900%. According to a Bankless report, the average BTC transaction fees were around $1.5 on February 10, 2023. But these had jumped to $15.56 on May 10, 2023. Reportedly, the primary reason behind this drastic increase is the introduction of Ordinals onto the Bitcoin Network. Ordinals are a new integration into Bitcoin's blockchain, supporting the creation of non-fungible tokens (NFTs) and BRC-20 tokens.

"Ordinals are driving up demand for transactions and pushing up prices on the Bitcoin network. And while that's great news for miners, it isn't so for small-scale transactors. The rise in NFTs and BRC-20 is straining the blockchain due to its limited block size and scalability issues," said Jonathan Merry, CEO, Bankless Times.

The report stated that if this trend continues, it could lead to serious implications such as centralization of mining power due to higher profits from larger block rewards or even a decrease in overall usage of Bitcoin due to its expensive nature compared with other blockchains like Ethereum or Litecoin.

"Lowering transaction fees would improve Bitcoin's reputation and increase its use case and appeal," said Merry.

Furthermore, the report finds that high transaction fees can put small transactors in a challenging spot since they'd be less inclined to use Bitcoin for smaller exchanges. Currently, Lightning Network works as an alternative option popular among users. Built on top of the Bitcoin blockchain, the Lightning Network operates as a second layer for the Bitcoin network that allows users to process transactions more quickly and for a significantly lower fee.

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Teena Jose

News Desk Reporter with Entrepreneur India

Teena is a post graduate in financial journalism. She has an avid interest in content creation, digital media and fashion.

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