Bitcoin
$62,473.70-2.13%
Ethereum
$3,193.86-3.28%
Binance Coin
$594.21-1.26%
Solana
$135.96-4.92%
XRP
$0.50728746-2.82%
Dogecoin
$0.14453869-3.48%
Toncoin
$5.34-2.04%
Cardano
$0.45460064-3.33%
Shiba Inu
$0.00002393-4.07%
Avalanche
$33.59-3.61%
Tron
$0.12002162-0.42%
Wrapped Bitcoin
$62,554.58-2.38%
PlayIconNav
Crypto Prices CoinDesk 20 Index CoinDesk 20 Index
Countdown to Consensus 2024The largest and longest running event that covers all sides of Crypto and Web 3
30
DAYS
06
HR
50
MIN
07
SEC
Markets

Bitcoin Fees Soar Nearly 1,000% Since August as Ordinals Are Back in Vogue

Higher fees are also boosting bottom lines for the industry's beleaguered miners, 21Shares noted.

By Krisztian Sandor
AccessTimeIconNov 8, 2023 at 6:10 p.m. UTC
Updated Nov 8, 2023 at 8:21 p.m. UTC
Number of Ordinals inscription on Bitcoin (21.co/Dune Analytics)
Number of Ordinals inscription on Bitcoin (21.co/Dune Analytics)
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now
  • Network fees on Bitcoin surged to near $7 amid resurgence of Ordinals inscriptions.
  • Bitcoin toppled Ethereum in NFT sales volume on Wednesday, per CryptoSlam data.

Bitcoin fees surged to the highest level since the meme coin mania this past May amid the resurgence of Bitcoin-linked non-fungible tokens (NFT), known as Ordinals.

At $6.84 on Wednesday, average transaction fees for using the Bitcoin blockchain are now up roughly 970% from a low of $0.64 touched in August, BitInfoCharts data shows.

The surge is driven by increasing minting of Ordinals, with nearly 1.9 million inscriptions uploaded to the blockchain over the past two weeks, digital asset management firm 21Shares pointed out in a report Wednesday.

Bitcoin became the top blockchain by NFT sales volume (excluding wash trading) in the past 24 hours, toppling Ethereum, CryptoSlam data shows.

Bitcoin average transaction fees (BitInfoCharts)
Bitcoin average transaction fees (BitInfoCharts)

Ordinals – a protocol that allows users to store NFTs on Bitcoin – saw a spike in demand this spring during a short-lived meme token craze and drove fees to almost 2-year highs. Binance, the world's largest crypto exchange, listed Ordinals' token ORDI earlier this week and it almost doubled in price before giving up some of its gains Wednesday.

"While ordinals have been limited to memecoin implementations, they do act as a proxy for increasing demand for Bitcoin blockspace," 21Shares analysts said.

Read more: The Ordinals Protocol Has Caused a Resurgence in Bitcoin Development

The resurgence of Ordinals also helps the bottom line of bitcoin miners, the report pointed out, with blockchain transaction fees now making up about 8.5% of their revenue.

This is of particular import for the miners as Bitcoin's quadrennial halving event expected in April 2024 is drawing nearer, which will cut block rewards for the industry in half.

UPDATE (Nov. 8, 19:40 UTC): Adds detail about Bitcoin and Ethereum NFT sales volume data by CryptoSlam.

Edited by Stephen Alpher.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Krisztian Sandor
Krisztian Sandor

Krisztian Sandor is a reporter on the U.S. markets team focusing on stablecoins and institutional investment. He holds BTC and ETH.

Follow @sndr_krisztian on Twitter

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.