Bitcoin and Ethereum Fees Surge Amid On-chain Activity Spike
On-chain Activity Spike Triggers Surge in Bitcoin and Ethereum Fees
A recent report from on-chain analytics start-up revealed a significant surge in on-chain activity this week, coinciding with a rally in Bitcoin and other cryptocurrencies to new yearly highs.
Bitcoin Transaction Fees Surpass Ethereum’s Total Fees
The surge in on-chain activity led to a substantial increase in transaction fees on the Bitcoin network, surpassing Ethereum’s total fees. Bitcoin fees soared by 60%, while Ethereum fees saw a nearly 50% increase.
Factors Driving the Increase in Network Fees
Several factors contributed to the rise in network fees for Bitcoin, including the cryptocurrency’s price climb to yearly highs of $45,000 and an uptick in Bitcoin transactions, leading to increased demand for network capacity.
Impact of Inscriptions on Bitcoin Transaction Costs
Due to the surge in inscriptions, the cost of sending a Bitcoin transaction has risen, with total fees amounting to $43.8 million for the week, representing a 61.4% increase.
Ethereum Sees New Yearly Highs Amid Network Fee Surge
Ethereum also witnessed a surge in fees, with Bitcoin in daily gains, reaching new yearly highs of $2,390. Despite this, Ethereum is not experiencing a major surge in new users, as observed by IntoTheBlock.
Rise in Whales Holding Ether
Notably, Ethereum is the only major layer-1 network where the percentage of supply held by whales has significantly increased. Whales now hold 35% of the ETH supply, up from 22% in January.
Conclusion
The surge in on-chain activity has led to a significant increase in transaction fees for both Bitcoin and Ethereum, with Bitcoin fees surpassing Ethereum’s total fees. While Ethereum has reached new yearly highs, it is facing challenges in attracting new users, as evidenced by the lack of significant spikes in new addresses and adoption rates.
