- Bitcoin transaction fees hit a record $80 million.
- Stacks exec believes that fees will become even higher as BTC L2 expands.
Bitcoin [BTC] Miners have been more profitable after the fourth halving. On April 20, BTC reached a record high of over $80 million, surpassing its previous all-time high in 2017, according to IntoTheBlock’s head of research: Lucas Outumuro;
“The $80 million in daily fees is approximately 4x greater than the previous ATH set in December 2017. The average transaction fee of $128 was a whopping $128, eclipsing the $30 peak reached during the first Ordinals frenzy.”
Source: X/Lucas Outumuro
The higher than average transaction fees have sparked debate about the demand for block space between Ethereum [ETH] and Bitcoin networks.
BTC vs ETH: Runic Effect?
Referring to BTC’s higher-than-normal average cost of $128, a pseudonymous crypto analyst claimed that the Bitcoin network now has more demand for block space than Ethereum. He declared;
“The average fee for sending value over the Ethereum network is currently around $0.50 (in the single digits). On the Bitcoin network it is $20. That’s a 40x difference in demand for BTC block space. Huge alpha there.”
It’s worth noting that the spike in BTC fees also coincided with the launch of Runes Protocol, a new Bitcoin fungible token standard.
However, another user, Adriano Feria, downplayed Bitcoin’s higher costs, stating:
“The cost of BTC is still $20 because LN (Lighting Network) is rubbish and there are no other alternatives.”
Feria added that blobs have had a positive impact on Ethereum and shifted demand to L2s;
“Demand for transactions secured by ETH is at an ATH level, but is only shifting to L2s.”
Source: X/Adriano Feria
Nevertheless, other analysts and executives expect Bitcoin to record more fees as the Runes Protocol gains traction and the BTC L2s heat up.
On the impact of Runes on BTC fees, Outumuro added;
“24 hours after the halving, inflation rewards are down 50%, but transaction fees are up 1,200% thanks to Runes. Miners earned record revenues of more than $100 million on April 20.”
Right now, Runes Protocol is dominated by memecoins. The upcoming Nakamoto upgrade of the Bitcoin layer-2 scaling solution, Stacks [STX]could further fuel activity and reimbursements.
Stacks co-founder Ali Muneeb recently highlighted that;
“Remember when we told you Bitcoin fees will be 500x? Yes, we worked on Bitcoin L2s for a reason. Happy halving, everyone! Next stop, Nakamoto.
Merlin Chain, another BTC L2, went live on April 19 and now leads in terms of TVL (Total Value Locked) per DefiLlama facts.
If the BTC L2 ecosystem reignites interest in the network, BTC transaction fees could continue to rise.