On-chain analytics startup IntoTheBlock reports a spike in on-chain activity this week, as Bitcoin and other cryptocurrencies soared to new annual highs.
As a result, the Bitcoin network saw a large increase in transaction fees, surpassing Ethereum’s total fees. In this comparison, Bitcoin fees increased by 60%, while Ethereum fees increased by almost 50%.
Activity on the chain surged this week, with Bitcoin fees rising more than 60% and Ethereum fees rising nearly 50%. pic.twitter.com/H2kFC6iQge
— IntoTheBlock (@intotheblock) December 8, 2023
A combination of factors appear to be driving the rise in Bitcoin network fees, including a Bitcoin price surge that saw the cryptocurrency hit a yearly high of $45,000 on December 5 before surging above $43,000, where it is currently trading, and a rise in Bitcoin inscriptions. , which increased the demand for network capacity.
Due to the popularity of inscriptions, the cost of sending a Bitcoin transaction has increased.
Bitcoin’s total cost for the week was $43.8 million, marking an increase of 61.4%. Total fees for Ethereum were $83.3 million, which represents a growth of 48.3%, according to IntoTheBlock data.
In today’s trading, Ethereum surpassed Bitcoin in daily gains, hitting a new yearly high of $2,390. ETH is up 4.58% over the past 24 hours to $2,360 at the time of writing. In this time frame, Bitcoin rose just 1.26% to $43,937.
Despite the recent bullish climb to new yearly highs, IntoTheBlock sees a worrying indication for Ethereum. It notes that Ethereum is not experiencing a large surge of new users as the number of new addresses and new adoption rates are not showing significant spikes.
Despite this, Ethereum is the only major layer 1 network where the percentage of supply owned by whales has increased significantly. According to IntoTheBlock, whales now own 35% of the ETH supply, up from 22% in January.