The protocol is facing a temporary setback due to over 300,000 unprocessed transactions.
The Bitcoin network has recently experienced a significant surge in transaction fees, with costs temporarily spiking to nearly $52 per transaction.
At the peak, network fees reached 514 sats for high-priority transactions and 513 sats for low-priority ones, with earlier rates climbing to approximately 520 sats per transaction, equating to $50 to $52 per transaction in U.S. dollars. Currently, priority fees have decreased to about $46 per transaction.
Blockchain reporter Colin Wu noted that the 332,000 unconfirmed transactions may be due to centralized exchange OKX collecting and sorting through wallets. However, this had not been confirmed by the time of publication.
According to Mempool, the current Bitcoin network fee has soared to 520 sat/vb (~$52), and it is in a congested state. It is suspected that OKX (bc1quh…0r8l2d) is sorting and collecting user wallets. There are more than 330,000 unconfirmed transactions on the Bitcoin network,…
— Wu Blockchain (@WuBlockchain) June 7, 2024
Post-Halving and BTC Miners
The post-halving season has brought concerns about miner difficulty, elevated network fees, and miner profitability into sharper focus on the Bitcoin network. The block reward reduction from 6.25 bitcoin to 3.125 BTC at the end of April has significantly impacted miner profits.
Interestingly, Bitfarms revealed a 42% decrease in mining revenue for May, marking the first complete month following the most recent halving event. According to the Bitcoin mining company’s end-of-month report, they earned 156 BTC in May, a notable decline from the 269 BTC earned in April.
The bitcoin mining firm further noted that its Argentina facility experienced unusually low temperatures in May due to some of the most severe weather conditions in 44 years. These poor weather conditions led to the temporary closure of the company’s Rio Cuarto facility for eight days, reducing the overall BTC mined.
Since the beginning of 2024, bitcoin miners in the U.S. have collectively spent $2.7 billion on electricity despite the escalating difficulty of computing and lower rewards.
Analyst Paul Hoffman stated, “Bitcoin mining in the U.S. has consumed a staggering 20,822.62 GWh of electricity since the beginning of 2024.” Additionally, he noted that this energy usage could sustain 1.5% of U.S. households for an entire year.
In April, the average cost to mine one BTC stood at $53,000. However, after the halving event, the cost of mining a single bitcoin has surged, doubling to an average of $110,000.
