Journalist
Posted:
- Transaction fees on the Bitcoin network rose to a new high during the week.
- This happened despite the decline in network activity during that period.
Total fees paid to complete transactions on Bitcoin [BTC] network rose to a three-month high of $7 million this week, on-chain data provider IntoTheBlock noted in a recent post on X (formerly Twitter).
Total Bitcoin costs continue to rise, hitting a three-month high of $7 million this week! pic.twitter.com/H46FjuriUE
— IntoTheBlock (@intotheblock) September 22, 2023
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Miners took no chances
The increase in fees spurred miners on the Bitcoin network to divest some of their coin holdings to book profits. A review of Bitcoin’s Miner to Exchange Flow on a seven-day moving average showed the metric rising to a one-week high of 1,343 BTC on September 21.
This suggested that miners were quickly selling their coins on cryptocurrency exchanges as costs rose.
Source: CryptoQuant
The Miner to Exchange Flow metric measures the amount of BTC flowing from miners to exchanges. When this statistic increases, miners are selling more BTC than they are mining. It often suggests that miners are bearish on the price of BTC and want to sell their holdings.
BTC’s Miner Reserve – which measures the number of coins held in member miners’ wallets – fell over the reporting period, confirming the outflow of coins from miners’ wallets.
After peaking at 1.844 million BTC when the coin briefly traded above $27,000, the Miner Reserve metric plummeted, falling to 1.841 million BTC on September 22, according to data from CryptoQuant.
Source: CryptoQuant
Rates increased despite the decline in network activity
An assessment of user activity on the leading blockchain network over the period studied found that while there was an increase in fees, there was a decrease in network activity.
According to data from Glass junctionthe week was marked by a decline in new demand, as the daily number of new addresses appearing for the first time in a transaction on the network fell by 18%.
Similarly, the number of unique addresses completing transactions involving BTC also fell by 12%.
Source: Glassnode
Read Bitcoin’s [BTC] Price forecast 2023-2024
The drop in network activity on the blockchain was noted in a reduction in the number of daily Ordinals inscriptions made during the week. Data retrieved from a Dune Analytics The dashboard revealed a 53% drop in daily registrations on the Bitcoin network.
Source: Dune Analytics
At the time of writing, the leading crypto asset was exchanging hands at $26,550. The coin returned to the $26,000 price area after a temporary spell above $27,000 on September 19.