In early May, the daily number of transactions in the bitcoin network updated its all-time high at around 685 thousand. This happened against the backdrop of a surge in activity associated with the release of bitcoin NFTs or Ordinals.
The ability to issue tokens on the bitcoin network appeared at the end of January, and since then there have been created already more than 4.69 million. More than 789 BTC ($21.9 million) in the form of commissions were spent when they were issued.
By data As of May 8, more than 455,000 more transactions are awaiting confirmation in the blockchain of the first cryptocurrency, which is a record high. The experts told RBC-Cryptowhat the formation of such a “plug” can lead to.
Causes and Solutions
The formation of a queue is a fairly typical situation for PoW blockchains, many factors can affect this, but the main reason is always associated with a sharp increase in interest in transfers within the network, explained Nikita Zuborev, senior analyst at Bestchange.ru aggregator.
According to him, then the problem develops like a “snowball” – the queue generates an even larger queue, by analogy with traffic jams, which are formed from traffic jams when they are trying to go around. In blockchains, users start raising fees, and all new transactions get stuck, while old ones can remain in the mempool for weeks until the load decreases.
There is no direct solution for this situation, the expert says. In general, the “scalability problem” is the main reason for criticism of the Proof-of-Work (PoW) consensus mechanism, which also powers Bitcoin. But the analyst noted that there are local ways around this problem, such as “replace-by-fee” or “child-pays-for-parent” mechanisms.
“Replace-by-fee” allows you to directly change the fee in a transaction already submitted to the pending list, but very few wallets support this feature. And to enable it, this should have been foreseen in advance: the transaction had to be sent with the parameter enabled, which allows you to replace the commission after sending the transaction, Zuborev explained.
The “child-pays-for-parent” function involves sending a new transaction from the wallet, which should receive change from a hung previous transaction with a deliberately high commission – such that it would be profitable for miners to process two transactions at once.
According to the expert, the use of L2 solutions partially solves the problem of scalability, for example, for bitcoin there is a Lightning Network add-on that does not load the main blockchain. The widespread introduction of this technology will help prevent the creation of queues in the future, Zuborev added.
Impact on the price of bitcoin
The current significant queue in the BTC network is unlikely to affect the value of the asset at the moment, but it creates a number of questions about what is happening around the Bitcoin blockchain, says Viktor Pershikov, an analyst at the cryptocurrency market.
He explained that if before the BTC network seemed to market participants as something fundamental, stable, which is very difficult to change and, as a result, difficult to worsen in terms of its parameters, then after the emergence of such projects as Ordinals, Bitcoin no longer seems to be a cryptocurrency “constant” .
The fact that thousands of enthusiasts can now create NFTs on the Bitcoin network using the BRC-20 experimental script (this standard allows you to create tokens on the Bitcoin network using the Ordinals protocol) expands the project’s capabilities, but does not create additional value for BTC, the expert says. He noted that the bitcoin blockchain has never been scalable anyway, and during periods of load and strong movements in the cryptocurrency market, transactions in the network, in comparison with other blockchains, turned out to be very slow.
Now, against the backdrop of an increase in the number of transactions – at the moment their number “in the queue” exceeded 400 thousand, the commissions in the network have also increased, which adds to the negative. According to Pershikov, if earlier BTC was perceived by investors as a reliable, top crypto asset, now, against the backdrop of what is happening on the network, the benchmark assessment may change for the worse.
Thus, over time, the perception of bitcoin as the first asset of the market may shift towards other projects that will offer reliable, fast and profitable transactions, the analyst believes. Thus, according to him, the events of today in the future may lead to a decrease in interest and capitalization of BTC.
Source: Cryptocurrency

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