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BTC transaction fees are soaring, the spring of miners is coming, what problems may it bring?
In March 2023, Twitter users@domodataAn experimental Token standard created for Bitcoin that leverages serial number inscriptions on JSON data to enable token deployment, minting, and transfers—now known as BRC-20.
BRC-20 is derived from the Ordinals protocol. It was in the development period in March, and it ushered in explosive growth in April and May.
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Bitcoin average transaction fee trend chart
The composition of miners' income - at present, the composition of miners' income is divided into two parts:
● Block reward: 6.25 $BTC / block
● Transaction fee: It is also the handling fee for packaged transactions. The amount of transaction fees varies according to network conditions and user settings. Measured by each byte, the current low-priority average fee in the Bitcoin memepool pool is about 300 sats/byte, which is about 11 u/byte .
The single-block transaction fee income of Bitcoin miners has also exceeded 1 $BTC since May 1, and has been advancing all the way. An astonishing 6 $BTC, the transaction fee of some blocks even exceeds the block reward itself.
At present, BRC-20 has spent a total of about 493 bitcoins in transaction fees, of which 245 were spent in the last 24 hours, accounting for 49.6% of BRC-20’s expenditures since its inception
BRC-20 exploded, how much money did the miners earn?
Taking May 1st to May 8th as a cycle (our cut-off time is: 11:31:34 am Beijing time, May 8th), we roughly counted the income of Bitcoin miners for the past week, and obtained the following data:
1. During the statistical period, the total income of miners is (block reward + transaction fee): 8100 BTC;
2. Among them, the statistical block is 1090, and the total block reward of miners is: 109 0X 6.25, a total of 6812.5 $BTC
3. During the statistical period, the total transaction fee income earned by miners is approximately: 1288 $BTC, accounting for 15.9% of the total income. That is to say, in the last week, Bitcoin miners captured more than $36 million worth of transaction fees.
4. Calculated according to the proportion of the mining pool, the Foundry mining pool received the most fee income, about 11.736 million US dollars. The specific amount and proportion of the mining pool’s handling fee are as follows:
Foundry 32.6% 420 pieces $11.736 million
Antpool 19.88% 256 pieces $7.2 million
f2 pool 10.49% 135 pieces $3.78 million
ViaBTC 8.52% 110 pieces $3.08 million
High Bitcoin "gas" moments in history - While current Bitcoin transaction fees are high, there have been higher records in history.
On December 22, 2017, the average transaction fee per transaction of Bitcoin on that day exceeded 55 u respectively, and the state of high transaction fees lasted for about two weeks, corresponding to the 2017 Bitcoin bull market peaking at $20,000. In 2017, at the block height of 500521, the fee reward for a block reached 13.7 BTC, which is the block with the highest fee according to the currency standard.
On April 22, 2021, the average transaction fee per transaction of Bitcoin on that day exceeded 62 u, and the state of high transaction fees lasted for about two weeks, corresponding to the peak of $64,000 in the last round of bull market.
From this point of view, the three most profitable methods in the currency circle are circulating on the rivers and lakes: Bitcoin mining, exchanges, and currency issuing factories.
Ordinals and the future of BRC-20
This round of increase in Bitcoin network transaction fees is mainly due to the hype of ordinals NFT and BRC-20.
In particular, the BRC-20 token $VMPX has become the main driver of this round of Bitcoin transaction fee increases.
$VMPX is created by the 21st Googler, founder of XEN@mrJackLevinOne of the BRC-20 tokens launched was mint released in the early hours of this morning, and mint has now ended. When it was launched, it once crashed BRC-20’s main trading website unisat and wallets.
In addition, because the current liquidity of BRC-20 is not sufficient, CEX needs to release its liquidity, and some CEXs have begun to list related tokens.
The first BRC-20 landed on CEX
BRC-20 appeared under the same controversy and enthusiasm as MEME coins, doubts from Bitcoin OG, enthusiastic jubilation in the market, silent but profitable Bitcoin miners, congested to the exchange to suspend withdrawals Bitcoin network, all of these make whether BRC-20 can really develop into an independent narrative, and more question marks are added behind the stable plate.
For now, the extremely high cost threshold and operational threshold also hinder the development of BRC 20. Whether the follow-up BRC 20 can be combined with the Lightning Network, whether it can break away from the simple narrative of issuing coins, and integrate RGB and other Bitcoin L2 with smart contract functions, etc., are all worthy of attention.
How much change BRC-20 will bring is unknown, but the pebble has been thrown into the lake, and all we can feel are ripples.
The last thing the encryption industry will stop is new stories.
