One lucky miner earned 6,701 bitcoins or nearly $200,000 in transaction fees on Sunday night, more than bitcoin’s current block subsidy of 6.25 BTC. This is an extremely rare event, indicative of a recent explosion of Ordinals Protocol activity on the blockchain, which has resulted in high costs for users.
Late last year, Ordinals introduced “inscriptions” — arbitrary content, such as text or images, that can be added to consecutively numbered satoshi (“sats” — the smallest units in bitcoin) to create tokens. Unique, non-fungible or NFT. Ordinal numbers are also currently being used to mint BRC-20, which are almost fungible tokens.
All of these new coins are quickly gaining popularity, but at a high cost. They clogged the Bitcoin network and pushed it to its limits, providing a real-world test of how the world’s first and largest blockchain can handle the demands of rapid scaling.
With deposit fees rising and transaction queues getting longer, some users and exchanges are starting to consider alternatives. These include the Lightning Network, which is considered a “layer 2” scaling solution designed to make bitcoin transactions faster and cheaper.
“How do I attract people with these fees? I mainly recommend people in Africa, but they don’t have the same privilege as you to pay these high fees. They really need BTC, and you are just being stupid,” Bitcoin Educator and Bitcoin Fair Founder Anita Posch told Cointelegraph. tweet.
BRC-20 is JavaScript Object Notation (JSON) data records — code snippets that transform data structures across various platforms. Since JSON literals are actually code, they can be programmed to generate large numbers of tokens—a batch at a time, in small chunk sizes—by exchanging to create effectively fungible tokens. irreplaceable awareness.
The possibility of minting a large number of tokens from nothing will cause loss of control and anxiety among blockchain users. Recent blocks have been filled with BRC-20 transactions, with fees hovering around $20 per transaction, an 800% increase from the $1-2 common for most of 2022.
The rise in handling fees has brought shockwaves to the entire Bitcoin ecosystem, causing the world’s largest cryptocurrency exchange, Binance, to temporarily suspend bitcoin withdrawals due to miscalculation of handling fees and difficulties in parts of Africa and Asia. Residents in Latin America use bitcoin currency for daily payments.
High Bitcoin fees have an undeniable impact on users who rely on the underlying payment. This is where the Lightning Network comes in. The Lightning Network is Bitcoin’s layer 2 scaling solution, in which a group of interconnected computers route Bitcoin payments off-chain, making transactions cheaper and faster.
Binance says it is integrating the Lightning Network due to Bitcoin fee spikes.
But even the Lightning Network requires an initial on-chain transaction to set up a payment channel, and Posch said the cost is so high that even a single transaction is now impossible for many.
“Without using on-chain, you can’t open channels. Making custodial Lightning the only option. All this happened because some people thought it would be fun to break Bitcoin.”
Following the chain’s NFT minting craze, the Bitcoin breakout has become a “trending” topic on Crypto Twitter.
While Posch hinted that meme-loving hackers are happily testing the limits of Bitcoin, others have adopted more convincing explanations, suggesting without evidence that the BRC-20 phenomenon is indeed real. is a coordinated attack on the world’s dominant blockchain.
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