Total daily Ordinals inscriptions on the Bitcoin network fell to 282,467 on Tuesday from 374,037 on Sunday, but Bitcoin network congestion remains stubbornly high.
The slowing rate of new Ordinals, a form of non-fungible tokens (NFTs) on the Bitcoin network, comes as the network surpassed 7 million inscriptions on Monday.
Weekly Ordinals sales volume on the Bitcoin network fell 51.84% to US$37.8 million on Tuesday, according to CryptoSlam data.
There were 250,876 Bitcoin transactions waiting in line to be validated at 8:40 p.m. in Hong Kong, according to mempool.space data.
The network jam could be attributed to the red-hot growth of BRC-20 tokens, the fungible tokens standard built on the Ordinals protocol.
The number of different types of BRC-20s grew from 14,300 tokens on May 11 to 24,677 on Wednesday. BRC-20 tokens have a combined market capitalization of around half a billion dollars and have been increasing block space demand on the world’s first modern blockchain, according to data provider BRC-20.io.
The persisting Bitcoin network congestion raised concerns about the effect of Ordinals and BRC-20 tokens and their potential to clog the network, raising confirmation time and costs for regular Bitcoin transactions.
“Ordinals have slowed down a bit, and are taking a bit of a back seat to BRC-20s, and like you’re seeing, they’re behaving similarly and filling up the [memory pool],” said Yehudah Petscher, an NFT strategist at Forkast Labs. “It’s nothing but healthy for Bitcoin to see such tremendous activity, and its only threat is that it will drive the development of layer 2 solutions to help with scalability as we see on Ethereum already.”
Bitcoin’s network congestion can be measured by its memory pool size, or mempool, the queue of pending valid transactions waiting to be added to blocks. It is often measured in virtual bytes (vbytes), and a single Bitcoin block can theoretically hold up to a million vbytes.
The mempool size was at a near one-month high of 202.8 million vbytes as of 5:40 p.m. Hong Kong time. Bitcoin’s mempool size stood at 3.31 million vbytes on April 24, according to on-chain data from mempool.space.
“I know some are complaining about keeping Bitcoin pure as just a currency, but that’s old-world mentality,” said Petscher. “This is a decentralized blockchain and the people will use it exactly how it’s intended to be used, which is free from censorship and free to use as they want.”
The growing mempool size caused Bitcoin transaction fees to surge to a two-year high of US$30.91 on May 8, before retracing to US$5.6 at press time, according to Chicago-based financial data firm YCharts.
See related article: Weekly Market Wrap: Bitcoin dips to US$26,166 as memecoins flood the blockchain