Bitcoin is not missing recent jumps in cryptocurrency price, but it is also joining Ethereum in a less impressive way–higher rates.
Bitcoin rates are rising again, approaching the levels last seen during the recovery from the March 2020 crypto collapse, which was linked to the corresponding decline in the stock market.
On Thursday, they reached an average of $ 3,841, a 151% increase from last Sunday. Since then they have fallen a little; yesterday the average bitcoin transaction cost $ 2.9, according to BitInfoCharts.
The increase could mean that the all-time DeFi-driven activity on the Ethereum network is spreading to other blockchains as well, as Ethereum and DeFi lead the way towards the next cryptocurrency run.
Transaction fees are tied to the level of activity on the Bitcoin network, so when many users buy or sell, the fees increase.
The last time Bitcoin rates saw a significant increase was in May, when BTC prices rose from $ 7,900 to approximately $ 10,000 in just over a month. On the heaviest day, May 20, it cost over $ 6.60 on average to transmit a Bitcoin transaction.
Bitcoin rates reached their highest level during the last days of 2018, when the ICO craze was at its peak and Bitcoin prices were pushing $ 20,000. At that time, Bitcoin’s average transaction fees peaked at $ 54 per transaction.
The rise in cryptocurrency prices and network activity date back to DeFi Trends on Ethereum Seeking to increase the funds available for DeFi customers to use for loans and token swaps, many protocols are now distributing government tokens as a reward for locking up crypto in protocols like Compound and Rocker. As a result, Ethereum is attracting new users and seeing transaction volumes approach the limits of the current Ethereum architecture.
By virtue of being first on the scene and approaching the state as something akin to a household name, Bitcoin often acts as a benchmark for all crypto.
The increase in network activity is a positive sign for adoption, but fees at the current level for an industry that has been presented as a less expensive alternative to traditional banking can drive out potential users. The need for technological advance is increasingly urgent. Practically an important solution, Ethereum 2.0, is not too far.
Disclaimer
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.
