Despite a decline in network activity, transaction fees on the Bitcoin network reached a three-month high during the week. On-chain data provider IntoTheBlock reported that total fees paid to complete transactions on the Bitcoin network amounted to $7 million. This surge in fees prompted miners to sell off some of their coin holdings to book profits. The Miner to Exchange Flow metric, which measures the amount of BTC flowing from miners to exchanges, saw a one-week high of 1,343 BTC on September 21, indicating that miners were offloading their coins. The decline in miners’ coin reserves confirmed these coin exits from their wallets.
Interestingly, the increase in fees occurred despite a fall in network activity. Data from Glassnode showed a decrease in new demand, with a decline of 18% in the daily count of new addresses appearing for the first time in a transaction on the network. Additionally, the number of unique addresses involved in BTC transactions dropped by 12%. This decline in network activity was also evident in the reduction of daily inscriptions made on the Bitcoin network, which fell by 53%.
At the time of writing, Bitcoin was trading at $26,550, returning to the $26,000 price region after briefly surpassing $27,000 on September 19. It remains to be seen how the high transaction fees and declining network activity will impact Bitcoin’s price and future developments in the crypto market.
