Would You like a feature Interview?
All Interviews are 100% FREE of Charge
The surge in meme coins issued on the Bitcoin blockchain has caused transaction fees to skyrocket, interrupting withdrawals from Binance.
The rise in bitcoin transaction fees has been parabolic in recent days, reaching average fee levels of $19 on Sunday and $30.9 this Monday.
Bitcoin network fees haven’t been this high since the major cryptocurrency bull market in Spring 2021, according to data from BitInfoCharts.
Binance, the world’s largest cryptocurrency exchange by trading volume, suspended bitcoin withdrawals on Sunday due to surging fees levels. say it Twitter said it would need to adjust fees and process any outstanding transactions before resuming withdrawals.
In another update on Monday, Binance explained that “the price set did not anticipate the recent surge in gas prices on the BTC network.”
“We will replace pending BTC withdrawal transactions with higher fees so that mining pools can collect them,” the exchange said, allowing withdrawals through Bitcoin’s second-tier Lightning network. He also made it clear that he was working on it.
Bitcoin meme coin and ordinal
The surge in Bitcoin fees is widely believed to have been caused by the highly popular memecoins recently issued on the Bitcoin blockchain, including new and popular memecoins such as Pepe and Oldie.
Dubbed the BRC-20 token, it capitalizes on the growth of a Bitcoin-based non-fungible token (NFT) called Ordinal, competing with regular Bitcoin transactions for scarce blockspace on the Bitcoin blockchain. To do.
Bitcoin transaction fees at any point in time are essentially the price of blockspace at that point in time, the higher the demand for space due to Ordinal NFTs or Meme Coins occupying the space, the higher the price. .
“Significant increase in network charges”
Regarding the sharp rise in Bitcoin transaction fees, Hayden Hughes, co-founder of social trading platform Alpha Impact, said: Said Bloomberg on Monday reported that Ordinals had caused “significant increases in network charges and congestion.”
He further explained that this was a problem because Binance and other exchanges typically operated with a fixed fee for withdrawals because the fees they charged users were below the actual network fees.
“The queue of transactions pending verification for inclusion on the blockchain has grown significantly over the past few days, causing higher transaction fees and confirmation times,” Hughes said on Binance’s Twitter account. repeated the statement.