Bitcoins average transaction fees reach record high of 195 for the first time
Bitcoin (BTC) has been trading within a narrow price range for the past three months, experiencing a significant decrease in exchange volume and on-chain activity to an all-time low. Despite this, on June 8, at block height 847015, Bitcoin set a new record with its 24-hour average transaction fees soaring to $195.
Finbold gathered data from the mempool.space node, analyzing stats from the last 144 blocks, or roughly 24 hours. During this period, miners received a total of 821.46 BTC, valued at $57 million, translating to an average of 2.5796 BTC per block, equivalent to $179,029.
This resulted in the daily average transaction fee on the Bitcoin network spiking to 281,030 sats, or $195. Sats represent the smallest unit of Bitcoin, named after the cryptocurrency’s creator, Satoshi Nakamoto.
The latest figures indicate that the last 144 Bitcoin blocks exclusively comprised transactions with this elevated additional payout to miners.
When we reflect on historical data, the network previously hit a high of $127.97 per transaction on April 20, coinciding with the halving. Before that, in April 2021 during the bullish cycle, average fees surpassed $60 for the first time.
On June 7, data from BitInfoCharts revealed a peak daily transaction fee of $83.74. Notably, Vini Barbosa highlighted a previous average fee of $65.76 at 10 pm UTC in a post on X.
At the current average transaction fees, numerous addresses and Bitcoin users are unable to spend their coins due to the concept of “dust.”
Additionally, on June 2, Finbold reported a different milestone for the Bitcoin network, as spot trading and on-chain transaction volume plummeted, while ETFs and derivatives dominated market interest for speculative demand. Santiment data showed a record low 7-day transaction volume of 474,000 BTC and shrinking spot trading volume.
Bitcoin analysts observed a UTXO consolidation spiral from the crypto exchange OKX, with 974 consolidation transactions remaining in the mempool. This activity has impacted the recent surge in average transaction fees on Bitcoin, as OKX engages in a bidding war, paying higher fees for each transaction.
Bitcoin fees tend to rise when there is increased demand for limited space on the blockchain, leading users to compete and outbid each other to expedite their transactions. As the network becomes more congested, fees escalate accordingly.
While Bitcoin’s protocol intentionally maintains a small block size and a 10-minute block interval, other cryptocurrencies have devised alternative solutions to address fee concerns. For instance, Bitcoin Cash (BCH) increased the block size, Litecoin (LTC) reduced the block interval, Monero (XMR) combined both approaches, and Nano (XNO) eliminated fees altogether.
With Bitcoin fees hitting unprecedented levels in dollars and the looming threat of a potential sell-off, market participants are keen to observe whether the demand for block space will diminish, potentially leading to a decline in average transaction costs.
