The Bitcoin network is currently experiencing congestion and increased transaction costs due to the rising popularity of BRC-20 tokens. The surge in demand for BRC-20 tokens has led to an overloaded Bitcoin network, resulting in a backlog of over 280,000 unconfirmed transactions. Mempool.space reports that memory pool usage has exceeded 300 MB and reached 1.57 GB.
The mempool, Bitcoin’s transaction waiting area, is currently filled with unconfirmed transactions, causing nodes to prioritize transactions based on minimal fee thresholds. This congestion in the mempool has led to higher transaction fees, ranging between $14 and $16.50, depending on priority.
The congestion is attributed to a recent spike in BRC-20 token minting, with over 450,000 tokens minted per day in the past few days. BRC-20 is an experimental token standard that enables the minting and transfer of fungible tokens on the Bitcoin blockchain. Earlier this year, a similar surge in ordinal minting caused network congestion and increased transaction fees.
Ordinal inscriptions, similar to NFTs, are digital assets that can be inscribed into one Satoshi, the smallest Bitcoin denomination. The surge in BRC-20 popularity is driven by the use of ordinal inscriptions, leveraging the SegWit upgrade introduced in 2017.
The article highlights the market value of the Ordinals (ORDI) BRC-20 token, which has exceeded $1 billion, making it the first of its kind to achieve this milestone. ORDI, a meme coin using the Ordinals protocol for inscriptions, experienced a 28% price surge to reach an all-time high of $65.18.
Additionally, the article notes the price surge of Stacks (STX), a protocol for building on Bitcoin, which has seen a 50% increase over the past week, trading at $1.15 at the time of writing.
Despite the network congestion and rising transaction costs, Bitcoin itself has reached another 2023 high of $44,367 during the Wednesday morning Asian trading session. The article provides insights into the challenges and dynamics associated with the current state of the Bitcoin network.