- The percentage of Bitcoin miner income from fees rose to 42% in the past 24 hours.
- Due to the backlog increase, the number of unconfirmed transactions on Bitcoin reached a whopping 402,071.
The Bitcoin [BTC] network is becoming more and more congested by the day, with the number of transactions rising to unprecedented levels. Since the beginning of May, an average of 537,500 daily transactions have been reported. As of May 8, 574,914 transactions were processed on-chain, according to from Glassnode facts.
Surprisingly, as noted by a Glassnode data scientist, the active addresses in the chain decreased significantly, establishing a negative correlation with the number of transactions. At the time of the tweet, the correlation coefficient was at its lowest point in history.
Convincing negative correlation between #Bitcoin active addresses and number of transactions.
It currently sits at the lowest value in history.
A wave of transactions, but addresses are left behind.
📊https://t.co/UtNO3oPzPa pic.twitter.com/mPuGienV2M
— Rafael Schultze-Kraft (@n3ocortex) May 8, 2023
Due to the growing transaction disruption, the king coin dipped below $28,000, going to a low of $27.3,000 on May 8. However, the coin recovered to $27.6 at the time of writing, though it still marked a 1% drop in the 24-hour period, data from CoinMarketCap showed.
Read Bitcoin [BTC] Price Forecast 2023-24
Bitcoin gets clogged
At the time of writing, memory consumption per block exceeded the 300 MB limit by 700 MB, causing the blockchain to reject any transaction worth less than 29.02 sats/vB, or Satoshi per byte, according to data from Bitcoin Explorer Mempool. Transaction fees peaked above 175 sats/vB, or $6.76 for high priority transactions. At the peak of congestion on Monday, it rose to $23.
Due to the backlog increase, the number of unconfirmed transactions reached a whopping 402,071 at the time of writing.
The world’s largest centralized crypto exchange, Binance, had to suspend BTC withdrawals twice in the space of 48 hours due to high gas costs due to network congestion. Because of the higher transaction costs, miners made a killing as the percentage of Bitcoin miner revenue from fees rose up to 42% in the past 24 hours, according to Santiment.
Source: Glassnode
Reasons behind the traffic
Network traffic increased mainly due to transactions with Taproot addresses. The demand for Taproot was also reflected in the adoption and usage metrics.
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Taproot adoption has surged over the past month, with nearly 70% of all transactions on Bitcoin using Taproot in the past 24 hours, according to data from Santiment.
Source: Glassnode
With the Taproot upgrade, Bitcoin has positioned itself like other conventional layer-1 blockchains, allowing smart contracts to be deployed on-chain and Ordinals to mint NFTs. From DuneAccording to May data, there is a surge in new enrollments, growing at 85% month-on-month (MTD).
