While Bitcoin (BTC) continues to rule the cryptocurrency markets with the highest price runs and market capitalization, the crypto-communities are facing a huge problem. According to the latest on-chain data, the transaction processing fees for Bitcoin (BTC) are hitting an all-time high.
While several speculations around the surge in the transaction fees, the majority are pointing towards one particular event. Many state that the rise in the price of Bitcoin (BTC) transaction fees is the result of an explosion that took place in China.
The sources reveal that an explosion took place in Xinjiang, China that is the main cause behind the surge in the prices of Bitcoin (BTC) transactions. Xinjiang in China is one of the top districts popular among the Bitcoin (BTC) miners due to its low-cost energy.
As an explosion took place in the Xinjiang district, many Bitcoin (BTC) miners were deprived of the ability to mine. This resulted in an entire district from China going offline that adds up to the total mining power of 34% of Bitcoin (BTC) by China.
The Xinjiang district in China still continues to face the power outage problem even after a week. This has resulted in the price of Bitcoin (BTC) transaction fees to surge and reach all-time highs.
One of the on-chain data-reporting firms, BitInfoCharts has shared recent stats around the rise in Bitcoin (BTC) processing fees. The firm has reported that the transaction fees are currently hovering at $58.42, and this is a new all-time high record.
Previously, the all-time high transaction fee was $55.16 that was observed back in December 2017. Because of the explosion that took place last week in Xianjing, the Bitcoin (BTC) hash rate has also experienced a significant drop.
Due to the drop in hash rate, it is now taking time for the Bitcoin (BTC) transactions to be approved and authorized. This is the reason why the fees for processing Bitcoin (BTC) transactions are surging and it is currently experiencing an all-time high.
Ever since the hash rate dropped for Bitcoin (BTC), users from all over the world are bidding higher fees in order to get their transactions through before anyone else does.
To make things worse, the auto-adjustment feature of Bitcoin still has not kicked in. It has been reported that it will take Bitcoin’s auto-adjustment feature 11 days before it can be implemented.
Until that happens, the cryptocurrency users will have no choice but to face the consequences and incur high fees per BTC transaction.
BitInfoCharts has shared another piece of information that is even more alarming than the one above. The firm has stated that the median transactions are also experiencing an all-time high and have grown three times higher than the initial median fee. At the time of writing, the median fee price is sitting at $26.89.