Bitcoin saturated! The network is struggling with +200,000 transaction backlogs!

The Bitcoin network is facing a persistent congestion problem despite a significant reduction in transaction fees. Since June 9, 2024, transaction fees have remained below $7 and have even dropped below $3 in the last five days. However, this fee reduction has failed to solve the backlog problem, which has exceeded 200,000 unconfirmed transactions since October 2023.

Despite the drop in fees, Bitcoin is experiencing congestion!

The current situation highlights the scalability challenges facing the Bitcoin network. Despite growing demand for block space, the fee market has not kept up. Which raises questions about whether the network will ever be completely free of this backlog. The average transaction fee is currently 22.3 satoshis per virtual byte (sats/vB). That is, approximately $2.67 per transaction, with a high priority transfer fee of approximately 10 sats/vB, or $0.86 per transaction.

This congestion in the Bitcoin network is a clear indicator that demand is outpacing the capacity of available block space. While fees have generally been decreasing since April, there was a brief spike in the fee market on June 7, where the average transaction fee hit $83.74. At that time, the mempool was considerably fuller! With unconfirmed transactions exceeding 300,000 in the previous weeks.

The BTC network must evolve if it wants to remain a leader

Maintaining such a large backlog highlights the need for potential scalability solutions. Or, a broader implementation of scalability solutions, to facilitate transaction processing.

The Bitcoin network must find ways to improve its efficiency and scalability to meet growing demand. This could involve protocol improvements or wider adoption of scalability solutions such as the Lightning Network. The current situation is a reminder that, despite its leading position in the crypto space, Bitcoin must continue to evolve to maintain its relevance and effectiveness.