Over the weekend, some believed that the Bitcoin network was under a DoS attack. What was the reason for a spike in transaction fees and huge the mempool backlogs?
The only way to attack Bitcoin (BTC) right now is to make it useless due to excess transactions and high transaction fees.
What’s Happening With Bitcoin?
Yes, a large number of transactions were suspended last weekend. Transaction fees were also higher than usual.
Yesterday, according to BitInfoCharts, the average Bitcoin transaction fee was $19.20. In addition, Mempool Space showed that there were backlogs of 444,341 transactions.
However, as of writing, the transaction fees are down to around $6, and unconfirmed transactions are down to around 406,000.
Transaction Fee Higher Than Bitcoin Reward
Yesterday, the increased demand on the network even led to the total cost per block temporarily surpassing the block reward of 6.25 BTC.
Miners who are the first to solve the “puzzle” and add a block (full of transactions) to the blockchain receive a bonus of 6.25 Bitcoin. It is halved every four years.
Each block is full of transactions, and each has to pay a small fee. In rare cases, the fee is higher than the bonus. This weekend was the first time since 2017 that this happened again. A Twitter user reported transaction fees of 6.76 BTC.
Bitcoin Attacked by NFTs and Memes?
According to Glassnode, on May 7, as much as 75% of Bitcoin transactions used Taproot.
The surge in activity and demand for blockspace (limited space in a block for transactions) has been attributed to the rise of Bitcoin inscriptions.
It is a new product on Bitcoin that uses the Ordinals technology to create non-fungible tokens (NFTs) and inscribe them into satoshi, the smallest unit of Bitcoin. With the new BRC-20 standard, meme coins can also be created on Bitcoin.
Is This a Deliberate Attack on Bitcoin?
Some Twitter users speculated that this weekend’s congestion was caused by a Denial of Service (DoS) attack on the Bitcoin network. With a DoS attack, thousands of transactions would be made to slow down Bitcoin and intentionally make it more expensive.
Many well-known analysts quickly denied the rumors. For example, 0xfoobar tweeted:
Bitcoin mempool finally gets some usage and the maxis are framing it as a DoS attack on the network. They really have not considered even the most basic scenarios, like “Bitcoin becomes popular and people are willing to pay to use it”
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