Quick Take Bitcoin fees have started to explode due to the emergence of Ordinals and BRC-20 tokens. Taproot made it easier for “Ordinals” to enter the Bitcoin blockchain. The mempool is processing as designed, but as a result, the fees are adjusting much higher. This results in one of if not the highest recorded transaction fees ever. This has potentially sorted out Bitcoins security model; when the block reward diminishes, will the miners continue to mine? Would they be incentivized enough? Miners, for the first time since 2017, are getting paid more than the block reward; in block 788695, miners were paid 6.701 ($193,075) in fees. At the same time, the block reward was 6.25 BTC. However, if you use the Bitcoin blockchain for payments, your fees have gone up, but this is the work of a free capital market. If people want to continue minting tokens via “ordinals,” they hope to sell for more than the cost of mint. For historical context, 31.7% of miner revenue has come from fees over the last 24 hours. Blocks: (Source: Mempool.space) Fees: (Source: Glassnode)

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