At Bitcoin it came at Block 788,686 to a split in the blockchain. Because: Two blocks were created that are no longer in the current blockchain. Such an incident happens extremely rarely – it last happened in November 2020. Although this so-called chain split is not dangerous for the blockchain, there was FUD and malice on the crypto market.
Critics blamed the current heavy congestion on the Bitcoin network for the error. In fact, the chainsplit was just an overlap between Foundry Pool USA and Antpool. “Everyone [Mining-Pool] solved a hash, then each solved another hash on their own chain in quick succession,” a blockchain expert explained. Since Antpool found the hash – an encrypted number – for the third block faster, the network then followed the longest blockchain.
A second, also not dangerous problem revealed itself at block height 788.759. Unlike usual, the bitcoin network took an hour to “produce” a new block. Similar incidents have happened in the past (albeit extremely rarely). Miners are now “producing” new blocks every 10 minutes.
Fees increase: Binance suspends transactions
How on-chain data show, there are currently more than 420,000 unconfirmed transactions in the BTC mempool. A new record that even beats the peak times of the 2018 and 2021 bull markets by far. This increased exponentially: the transaction fees. At the time of writing, a transaction averages $19.2. For comparison, the fee on April 23 was just $0.9. A unlucky investor paid $15,500 for a transaction of 3,425 BTC, for example.
The high network utilization was also the reason for a payout stop on Binance. In the last 24 hours, the world’s largest crypto exchange has stopped all BTC withdrawals twice. In order to avoid such incidents in the future, Binance is working on Integrate Lightning transactions.
Since the transfers in the Lightning network are processed “off-chain”, there is no need to wait for confirmation. The basic properties of the main layer remain, however, and secure the layer 2 solution. Thus, the Lightning network counts as one promising solutionwhich improves the Bitcoin blockchain in a sustainable way.
Bitcoin hype: ordinals and BRC-20 tokens
Reason for the high network utilization: Bitcoin NFTs. The hype surrounding the new BRC-20 tokens, which are issued via the Ordinals protocol, are currently causing immense activity in the Bitcoin network. As a result, on May 1, Bitcoin saw more transactions — around 682,000 — in a single day than ever before. A milestone in its more than 14-year history.
BRC-20 is a technical standard that allows developers to create custom tokens on the Bitcoin blockchain. Data from Brc-20.io show that more than 14,200 different BRC-20 tokens have already been created. Together, these tokens have a market cap of around $1 billion at press time.
A targeted bitcoin attack?
Meanwhile, in Bitcoin Maxi circles, the Ordinals protocol is viewed critically. Proof of Work is originally a system that is actually supposed to prevent spam. The argument goes that the blockchain is still being “cluttered” with random data packages that have little to do with financial transactions. On the other hand: Doesn’t an open protocol like Bitcoin have to bite the bullet and also allow non-financial transactions? At least that’s what Bitcoiners like Peter Todd claim.
Dylan LeClair – also known for his laser eyes – evaluates the high transaction fees generated by the ordinals as a “pretty obvious attack vector” against bitcoin. However, he claimed that the short-term increases in costs would not have a significant impact on the network in the long term.