Bitcoin Transactional Fees Skyrocket with Halving Event Looming, Under 6 Hours Left
- Bitcoin miners are now charging premium fees for transaction processing. The transaction fees have skyrocketed by over 300% from $0.63 towards the end of April to upwards of $3.00 on May 8th just a few days to the long-awaited 3rd halving event.
With just under 6 hours remaining before the third bitcoin halving unfolds, reports have emerged that BTC transaction fees have soared significantly in the past few months. Miners have increased their transactions fees with the BTC halving imminent.
The increased verification fees indicate that there are more users competing for resources within the BTC Network. Based on meticulous calculations, the network is then able to determine a premium fee for the miners as users are willing to pay more to get their transactions verified.
In the last 24 hours, bitcoin has been as low as $8,250 and as high as $9,180 BTC/USD after surpassing $10,000+ on May 7th.
Taking the previous industry trends as case studies, the transactional fees have always spiked onset Bitcoin halving. Towards the end of this April 2020, the transactional fee averaged at $0.62 and has only been on the on an upward trend since then.
Notably, on May 8th it settled at $3.19 marking a remarkable 300% bump. A similar trend was witnessed in 2016 as fees climbed from $0.10 to $0.62 in just a single day.
BTC halving is set to be triggered when the 630000th block is mined which has been predetermined to occur on May 13th. Miners are to bear the brunt of the halving as mining rewards per block are set to reduce by half from 12.5BTC to 6.25BTC.
The mining difficulty is also predicted to increase meaning it would be more expensive to mine. There are currently 18,374,250 BTC in circulation out the possible 21 million according to CoinMarketCap.
It's been reported that most of its mining equipment will become obsolete after the halving. This means the end of the road for hobbyist and smaller-scale miners that can’t afford the next-gen rigs. The latest rig to be released is the WhatsMiner M30 series by MicroBT rolled out in April.
Reports of miners hoarding BTC
There have also been reports of miners hoarding BTC. They have been issuing less BTC than they are mining. This according to industry experts only fuels speculations that the BTC will increase its price post halving. Renown Industry Analyst, Chris Wood, has also urged investors to diversify their portfolios to include BTC pre halving.