Blockchain
Bitcoin now costs as much as Ethereum in terms of fees: data from the second quarter of 2024 says
On-chain data shows that users of the Bitcoin blockchain had to pay the same total fees as Ethereum in the last quarter.
Bitcoin Users Paid $440 Million in Transaction Fees Last Quarter
As market intelligence platform IntoTheBlock pointed out in a new send on X, Bitcoin saw a big jump in transaction fees last quarter. The “transaction fees“here of course refers to the amount that senders on the blockchain must attach to their transfers as compensation to validators.
The average fee on the network generally reflects the activity that takes place on it. During periods of high traffic, users have no choice but to pay high fees if they want their transfers to be processed in a reasonable amount of time.
This is because the network has only a limited capacity to handle transactions. Therefore, validators naturally prefer to include the transfers with the highest fees first in the next block.
As users compete to get first moves, fees can skyrocket. During periods of low chain activity, however, senders have no incentive to pay high fees, so its value remains low.
Below is an infographic shared by IntoTheBlock showing the total amount of fees between Bitcoin and Ethereum in the second quarter of this year.
Looks like the fees has been almost the same for the two networks recently | Source: IntoTheBlock on X
As seen above, the Bitcoin network has seen total transaction fees of approximately $440 million over the past three months. This represents an increase of nearly 61% over the previous quarter.
While fees have increased significantly for BTC, the same has not been true for ETH. It appears that Ethereum users have paid 63% lower fees during this window compared to the last quarter.
Fees on ETH were previously significantly higher than BTC, earning the network a reputation for being expensive. With this drop, however, total fees on the network dropped to $441 million, which is just $1 million more than what was seen for the original cryptocurrency.
Now, what is causing these trends? In the case of Bitcoin, the introduction of the Runes April protocol is the main driver behind the growth. This protocol, which allows users to mint fungible tokens on the network, found immediate popularity and increased transaction activity for BTC.
Regarding Ethereum’s decline, the analytics firm notes that transactions have been shifting to Layer 2 solutions during this period. Layer 2 blockchains are built on top of a primary network to improve transaction throughput.
While both ETH and BTC see relatively high transaction fees, Litecoin (LTC) has continued to be the cheapest network recently, as IntoTheBlock shared in a answer to the post office.
The data for the average transaction fees on the various top cryptocurrency networks | Source: IntoTheBlock on X
BTC Price
Bitcoin has failed to significantly recover from the recent crash, as its price still hovers around $60,800.
The price of the coin appears to have been moving sideways over the last few days | Source: BTCUSD on TradingView
Featured image from Dall-E, IntoTheBlock.com, chart from TradingView.com