Daily Bitcoin transactions have reached an all-time High with 3 million Ordinals inscriptions

The total fees paid for Ordinal Inscriptions topped 272 BTC, around $7.6 million on Tuesday, according to a Dune Analytics report. On Monday alone, over 372,000 inscriptions were made 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 of the Bitcoin Frontier Fund, told Decrypt. The BRC-20 token standard made it possible to mint tokens and meme coins on the Bitcoin network, clearing the way for over 1 million more inscriptions to be added to the over 2.5 million already on the Bitcoin network in less than one week.

Introduced in March, BRC-20 – or Bitcoin Request for Comment number 20 – allowed the creation of fungible tokens using the Ordinals protocol, launching a new wave of interest in minting NFTs on the Bitcoin blockchain.

But while JPEGs are flooding the web, most inscriptions are still text-based.

“Text inscriptions are lower cost since you pay based on the size of the data,” Owens said. “So they’re low-cost, high-volume, whereas JPEGs and digital media are high-cost, low-volume.”

Currently, memory usage on the Bitcoin network is over 650MB, double the original capacity of 300MB, indicating a higher demand for data memory due to increased transactions and fuller blocks, according to data from Mempool. This increase can make running a node more challenging, but Ordinals supporters say it secures and strengthens the network.

“As long as the value gained by minting the BRC-20 tokens is higher than the value lost to the inscription fees, we will see fees on Bitcoin continue to rise,” said pseudonymous Twitter NFT historian @LeonidasNFT, adding that higher fees on Bitcoin is a very good thing.

“It indicates strong demand for Bitcoin’s block space, which is critical to the long-term success of the protocol,” Leonidas said. “The days of just using Bitcoin to transfer BTC to your hardware wallet once every couple of years have come to an end.”

High fees benefit the Bitcoin blockchain by incentivizing miners, prioritizing valuable transactions, and improving network security. But while uploading the Bitcoin blockchain with JPEGs and sending fees skyrocketing might be good for miners and the network’s security, it puts a higher price tag on transactions on the network.

“In February, we entered the Taproot Wizards collection, which took over 80MB of Bitcoin block space,” Taproot Wizards tweeted. “But now bitcoin transaction fees are so high that if we tried to enter 80MB with wizards today, the fees would cost us 32 BTC. Almost $1 million.”

“I think this is the best thing that could have happened to Bitcoin,” Owens said, noting that the launch and development of Ordinals did not require changing the Bitcoin base protocol. “We have unlocked new use cases to bring in liquidity, new users and many developers making Bitcoin more valuable through better user experience and more use cases is what we need to reach mass adoption.”