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.
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.
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.