Total fees paid for ordinal inscriptions surpassed 272 BTC, around $7.6 million, on Tuesday, according to a report by Dune Analytics. On Monday alone, over 372,000 enrollments were created on the bitcoin network — contributing to a daily record of 682,281 bitcoin transactions — with daily network fees of 23 BTC, or around $656,000.
“Most of the acceleration is BRC-20,” Trevor Owens, managing partner at Bitcoin Frontier Fund, told Decrypt. The BRC-20 token standard enabled the minting of tokens and meme coins on the Bitcoin network and paved the way for over 1 million more enrollments to be added in less than a week to the over 2.5 million that are already in the Bitcoin network.
Launched in March, BRC-20 – or Bitcoin Request for Comment number 20 – enabled the creation of fungible tokens using the Ordinals protocol, sparking a new wave of interest in minting NFTs on the Bitcoin blockchain.
But while JPEGs are flooding the network, most inscriptions are still text-based.
“Text labels are cheaper because you pay based on the size of the data,” Owens said. “So they’re inexpensive and widely available, while JPEGs and digital media are expensive and scarce.”
Currently, memory usage on the Bitcoin network is over 650MB, double the initial capacity of 300MB, which according to data from Mempool indicates a higher demand for computer memory due to the increased transactions and fuller blocks. This increase can make a node harder to operate, but Ordinals proponents say it secures and strengthens the network.
“As long as the value gained from minting BRC-20 tokens is greater than the value lost from enrollment fees, we will see fees for Bitcoin continue to rise,” said the pseudonymous Twitter NFT -Historian @LeonidasNFT, adding that Bitcoin’s fees are higher, which is a very good thing.
“This indicates strong demand for Bitcoin’s block space, which is critical to the long-term success of the protocol,” Leonidas said. “Gone are the days of just using bitcoin to transfer BTC to your hardware wallet every few years.”
High fees benefit the Bitcoin blockchain by incentivizing miners, prioritizing valuable transactions, and improving network security. While JPEG loading of the Bitcoin blockchain and skyrocketing transmission fees can be good for miners and network security, transactions on the network are becoming more expensive.
“In February, we enrolled the Taproot Wizards collection, which occupied over 80MB of Bitcoin block storage,” Taproot Wizards tweeted. “But now the bitcoin transaction fees are so high that if we tried to enroll the 80MB of assistant today, the fees would have cost us 32 BTC. Almost $1 million.”
“I think that’s the best thing that could have happened to bitcoin,” Owens said, noting that the adoption and development of ordinals did not require a change to the base bitcoin protocol. “We have unlocked new use cases to attract liquidity, new users and many developers making Bitcoin more valuable through better user experience and more use cases, which is what we need to achieve mass adoption.”
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