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Bitcoin user pays $3.1M transaction fee for 139 BTC transfer

November 23, 2023 Coin Telegraph

Bitcoin user pays .1M transaction fee for 139 BTC transfer

A mempool developer suggested that the user behind the transfer might not be aware of the non-cancellation of replacement fees policy, resulting in an accidental $3.1 million transaction fee.

A Bitcoin user paid 83.7 Bitcoin (BTC), worth $3.1 million, in transaction fees for transferring 139.42 BTC. The transaction fee of $3.1 million is the eight-highest in Bitcoin’s 14-year history.

The BTC wallet address bc1qn3d…wekrnl tried transferring 139.42 BTC to bc1qyf…km36t4 on Nov. 23, only to pay more than half the actual value in the transaction fee. The destination address received only 55.77 BTC. The mining pool Antpool captured the absurdly high mining fee on block 818087.

*Antpool mining reward history. Source: Mempool*

Users on social media suggested that the sender may have selected the high transaction fee, but the replace-by-fee (RBF) node policy and the sender’s unawareness also appear to have played a part. RBF allows an unconfirmed transaction in the mempool to be replaced with a different transaction that pays a higher transaction fee to get it cleared earlier. The mempool is where all BTC transactions are queued before approval and addition to the Bitcoin blockchain.

A mempool developer who goes by mononaut on X (formerly Twitter) said the user behind the transfer probably didn’t know RBF orders cannot be canceled. The user might have repeatedly replaced the fees in hopes of canceling it. The RBF history indicates that the last replacement increased the fee by another 20%, adding 12.54824636 BTC in fees.

*RBF history of the 83.7 BTC transaction fee. Source: Mempool*

This is not the first time a Bitcoin user accidentally sent an absurdly high transaction fee for a single Bitcoin transaction. In September, Bitcoin exchange platform Paxos accidentally sent a $500,000 transaction fee for a $2,000 BTC transfer. In that incident, the F2Pool miner who verified the transaction returned the $500,000 accidental transaction fee to Paxos.

However, this is the largest Bitcoin transaction fee ever paid in dollar terms, knocking the September Paxos transfer of $500,000 off its unfortunate podium. The largest fee in Bitcoin terms was paid in 2016 when someone accidentally sent 291 BTC in transaction fees.

Mononaut told Cointelegraph that although the current instance of an accidental transaction fee has similarities to the Paxos case, the possibility that Antpool would return the funds would depend on their own payout policies, ”which might have implications for what obligations they have to share transaction fees with their miners.”

Antpool has yet to comment on the issue and has yet to respond to Cointelegraph’s requests for comments.

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Bitcoin miner mulls refunding 20 BTC reward to Paxos

September 14, 2023 Coin Telegraph

Bitcoin mining

Chun’s reservations about whether to return the funds to Paxos stems from him being “annoyed” that “the person claiming it (the funds) kept saying EST instead of EDT/UTC.”

A Bitcoin (BTC) miner who mistakenly received 20 BTC — worth over $500,000 — from crypto exchange Paxos for settling a 0.008 BTC ($200) transaction is now reconsidering their decision to return the jackpot to its rightful owner.

On Sept. 13, Paxos revealed to Cointelegraph that it overpaid the BTC network fee on Sept. 10, to a miner who goes by the pseudonym Chun. While confirming that the event did not impact the traders' funds, the platform admitted that a system bug resulted in the disbursement of 20 BTC in mining rewards on one transaction.

While Chun initially agreed to refund the reward, he decided to reconsider his decision and reached out to the crypto community for advice.

I was annoyed and regretted agreeing to refund that 20 BTC. Especially when I saw the person claiming it kept saying EST instead of EDT/UTC. Last time a Zcash guy did that, I blocked his entire company.

Ref:https://t.co/MQh0ijLR11 https://t.co/lxtcFH9mq3

So what should I do?
— Chun (@satofishi) September 13, 2023

Chun’s unwillingness to return the funds to Paxos stems from him being “annoyed” that “the person claiming it (the funds) kept saying EST instead of EDT/UTC.”

*Bitcoin miner Chun asks crypto community for opinion on return of Paxos funds. Source: X*

Adding to Chun’s dilemma, the crypto community on X (formerly Twitter) shared mixed opinions — each supported by solid reasonings. However, most people believe Chun has no obligation to return the 20 BTC reward and agree that instead, it should be distributed among the Bitcoin mining community.

Depending on one’s physical location, Bitcoin mining business can have a varied profit margin. A recent report from CoinGecko showed that only 65 countries are profitable for solo Bitcoin miners, based solely on household electricity costs.

*The most unprofitable countries to mine 1 BTC. Source: CoinGecko*

Based on the data shown above, mining 1 BTC in Lebanon is 783x cheaper than Italy, where it costs $208,560 to produce 1 Bitcoin.

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Ordinals and BRC-20 will disappear in a matter of months, JAN3 CEO says

May 13, 2023 Coin Telegraph

Bitcoin Analysis

The hype around Bitcoin Ordinals and BRC-20 tokens is unsustainable and will fade away in a matter of months, according to JAN3 CEO Samson Mow.

The latest hype around Bitcoin (BTC) Ordinals and BRC-20 tokens is unsustainable and will fade away in a matter of months, according to JAN3 CEO Samson Mow.

“These guys are basically paying massive amounts of fees that go directly to Bitcoin miners, and there is no way this can be sustained," Mow said in an exclusive interview with Cointelegraph.

"They will fade away after even months, let's not talk about years here," he continued.

Growing activity around Ordinals and BRC-20 – a crypto technology that allows users to mint fungible and non-fungible tokens on the Bitcoin blockchain – is the main cause provoking a spike in transaction fees, which resulted in the congestion of the Bitcoin network.

While many members of the Bitcoin community see Ordinals as a use-case that could boost Bitcoin adoption, Mow considers them just as spam clogging the network.

"These are just short-term money grabs similar to most things on competing chains like Ethereum and Solana," he pointed out.

To Mow, mass adoption of Bitcoin will happen because of its use case as a saving technology and as a means of exchange, not because of “people minting JPEGs and sticking them in the chain.”

To learn more about Mow's argument against Ordinals, watch the full interview on our YouTube channel. Don’t forget to subscribe!

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Arbitrum’s DAO to receive over 3,350 ETH revenue from transaction fees

May 10, 2023 Coin Telegraph

Arbitrum

Proceeds come from base fees and surplus revenue generated from network transactions. The incentive follows a recent clash between Arbitrum's team and its community.

Ethereum layer-2 blockchain Arbitrum will distribute ETH (ETH) tokens worth nearly $6.2 million to its decentralized autonomous organization (DAO), the project announced May 9 on Twitter. ARB holders must claim the rewards.

The funds to be collected are base fees and surplus revenue generated from network transactions. According to Arbitrum's tweet, a total of 3,352 ETH will be collected by its DAO. As internet-native organizations, DAOs are collectively owned and managed by their members. They have treasuries and make decisions through proposals voted on by the group.

Big news Arbinauts!

Arbitrum is the only rollup that sends all surplus revenue generated by transaction fees to their respective DAO and it is time for the DAO to collect the funds so far!

Follow along to learn more about it.
— Arbitrum (,) (@arbitrum) May 10, 2023

Arbitrum is a popular scaling network used by many decentralized applications (dApps) and blockchain developers. All users pay a fee during transactions on Arbitrum One.

The cost of sending ETH on Arbitrum is currently at $0.25 and swapping tokens is $0.68 at the time of writing. Data from CryptoFees shows that Arbitrum's users paid $387,423 in fees over the past seven days.

Each fee paid on Arbitrum One is divided into two sections — L1 fee and L2 fee. According to the protocol, the L1 fee covers the cost of posting a transaction on the Ethereum network and the L2 fee covers the cost of running the network.

A revenue breakdown reveals around 582 ETH of surplus funds generated from the L1 fee, nearly 1,308 ETH from base fees and 1,462 ETH surplus from the L2 fee. Combined, this represents revenue of 3,352 ETH for Arbitrum's DAO.

According to the proposal discussion on Arbitrum's governance forum, the protocol will create a mechanism for revenue distribution that will be triggered periodically by a smart contract. Only delegated ARB tokens will be eligible for revenue distribution, and holders must claim their rewards.

Arbitrum says the move will "align community incentives and give ARB a purpose beyond a worthless governance token." Most community members support the proposal, according to the governance forum. Some members, however, highlighted that the revenue distribution might further serve to classify the ARB token as a security.

*Community member comments on Arbitrum’s "Distribution of DAO Revenue to ARB token holders” proposal. Source: Arbitrum Foundation.*

Arbitrum's incentive program was launched after the protocol team clashed with its community over a nearly $1 billion fund transfer that wasn't approved by ARB holders.

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Memecoin hype drives Bitcoin transaction fees to multi-year highs

May 5, 2023 Coin Telegraph

Coin Telegraph

Despite the latest spike in Bitcoin transaction fees, the current BTC transaction cost is still far from all-time high levels.

Bitcoin transaction fees saw a sharp surge in early May, reaching their highest point over the past two years, according to data from CryptoFees.

On May 3, the total amount of fees paid on the Bitcoin blockchain reached an amount of $3.5 million, jumping about 400% from late April. The average Bitcoin transaction fee reached as much as $7.2, according to YCharts.

The ongoing trading frenzy of memecoins like Pepe Coin (PEPE) has triggered an unwanted consequence for Bitcoin (BTC), driving its transaction costs to multi-year highs.

*Total Bitcoin transaction fees between May 2021 and May 2023. Source: CryptoFees*

The latest increase in BTC transaction fees is largely attributed to a surge in Bitcoin activity involving BRC-20 transactions. According to data from Galaxy Research, 50% of all Bitcoin transactions on May 2 were related to BRC-20 transactions.

Modeled after Ethereum’s ERC-20 token standard, BRC-20 is an experimental token standard allowing users to issue and transfer fungible tokens on the Bitcoin blockchain. The standard was introduced in March 2023 by a pseudonymous on-chain analyst known as Domo.

The BRC-20 token standard has quickly become a major trend in the cryptocurrency industry, specifically amid the sharp growth of the PEPE memecoin. The token has rallied more than 600% over the past seven days, reaching its all-time high of $0.00000216 on May 5.

*Pepe Coin (PEPE) 30-day price chart. Source: CoinGecko*

The Bitcoin blockchain isn’t the only blockchain affected by the ongoing memecoin hype. Gas fees on the Ethereum blockchain have also been skyrocketing to new multi-month highs recently.

On May 2, ETH transaction fees hit an aggregate amount of more than $19 million, a level not seen since May 2022, according to CryptoFees. The Ethereum blockchain remains the most expensive network in terms of transaction fees at the time of writing.

Despite the latest spike in Bitcoin transaction fees, the current BTC transaction cost is still far from all-time high levels. The highest Bitcoin transaction fees ever seen were recorded in April 2021, when the average BTC transaction cost almost reached $70 amid a major decline in the Bitcoin network hash rate. The previous highest point in BTC transaction fees was in 2017, with transaction costs surging above $60.

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Ethereum gas fee jumped due to memecoin frenzy with mixed comments on network usability

April 20, 2023 Coin Telegraph

Coin Telegraph

Ethereum proponents celebrated the growth in daily revenue, while many others pointed toward network congestion and difficulty in usage.

Ethereum network’s gas fee skyrocketed to a new multi-month high amid a growing memecoin frenzy. The high transaction fee has swelled Ethereum’s daily revenue multifold compared to Bitcoin (BTC). While Ethereum proponents celebrated the growth in revenue, many others were quick to point out the growing congestion on the network and the difficulty in processing transactions.

There was an unusual shift in the top 10 gas-burning altcoins where instead of ETH (ETH), WETH, and USDT (USDT), memecoins such as TROLL, APEDand BOBO were among the top 10 spenders.

⛽️ A highly unusual shift in top 10 gas burning #altcoins has emerged today. Instead of $ETH, $WETH, and $USDT being at the top of the fee distribution list, we're seeing new assets like $TROLL, $APED, and $BOBO among them. Read our latest deep dive. https://t.co/7SlmJ59k2m pic.twitter.com/Y2kaLKZTrL
— Santiment (@santimentfeed) April 19, 2023

The average gas price for Ethereum transactions as of April 20 was 81.94 gwei, up from 60.82 gwei on April 19 and 44.42 gwei last year — an increase of 34.74% from April 19 and 84.46% from April 20, 2022. Gwei is a denomination of the Ether and represents one billionth of one ETH.

*ETH gas fee increase in last month. Source: Ychart*

Independent Ethereum educator Anthony Sassano shared the surge in daily fee revenue of the Ethereum network and said that the second-largest blockchain had brought in 28 times the revenue of Bitcoin. He also cited Ethereum layer-2 platforms like Arbitrum One that have outperformed the BTC network in terms of daily revenue due to the ongoing meme frenzy.

*Daily and weekly revenue of various blockchain. Source: Twitter*

Ethereum proponent’s main argument is that the high gas fee and subsequent higher revenue highlight the network’s growing usability. However, many on Crypto Twitter were quick to point out that the extensive usage they are referring to is just a few thousand users gambling on memecoins.

The extensive usage you’re talking about are a few thousand users gambling meme coins. I thought (and hoped) eth was supposed to be the future of finance
— nap.BasicallyRiskFree (@CryptoPannella) April 20, 2023

A few users reportedly paid gas fees as high as a few hundred dollars, while others complained about having to pay a higher gas fee than the actual transaction.

try to buy a ~$20 NFT on eth, and the gas is ~$40.
some ppl say the infra operators deserve to be paid. sure, but imaging paying visa $40 fee for buying a $20 digital good.. infra should be affordable. pic.twitter.com/5L4SYjT5af
— 0xMQQ (@0xMQQ) April 18, 2023

Another prominent reason for the soaring gas fees was blamed on a Maximal Extractable Value (MEV) trading bot that is front-running memecoin trades on a massive scale. The bot in question jaredfromsubway.eth has been the top gas spender in the last 24 hours, spending 455 ETH ($950,000) and using 7% of the total gas of the network.

In the last two months, it spent more than 3,720 ETH ($7 million) in gas fees and performed more than 180,000 transactions.

bro has used 7% of the total gas on ethereum over the past 24hrs (455 ETH) just feasting away on $pepe

data from the legendary @hildobby_ https://t.co/j3SqtQnkKJ pic.twitter.com/hWavtdO1D5
— beetle (@1kbeetlejuice) April 18, 2023

The Subway-themed bot is using the sandwich trading technique to pocket millions of dollars while congesting the network at the same time.

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Post-Shapella Hard Fork: Ethereum Deposits Exceed Withdrawals, Wait Time Climbs, ETH Transfer Fees Jump

April 19, 2023 Bitcoin.com

The state of Solana: Will the layer-1 protocol rise again in 2023?

January 27, 2023 Coin Telegraph

Coin Telegraph

Despite the latest FTX-related crisis, Solana still has what it takes to win the layer-1 race, according to the head of strategy at the Solana Foundation, Austin Federa.

About two months after the FTX collapse, the Solana network is stronger than ever, according to Austin Federa, head of strategy and communications at the Solana Foundation.

Federa defines the recent SOL token price crash as a short-term market reaction to the perceived connection between Solana and the defunct crypto exchange FTX. While FTX founder Sam Bankman-Fried was invested in many Solana-based projects, Federa pointed out he didn’t have any influence on the network’s operations and fundamentals.

“The external perception was that there was a very close relationship between the Solana network and FTX, which wasn’t the case,” Federa explained in a recent interview with Cointelegraph.

According to a recent report by Electric Capital, the Solana network has been experiencing a record inflow of developers contributing to the ecosystem.

To Federa, developers are increasingly building on the Solana network because of its main value proposition: cheap and fast transactions.

“You can build new types of products and services that aren’t transaction-constrained,” he pointed out.

When asked to address the problem of outages that have plagued the network over the past year, Federa mentioned a number of technical upgrades that should improve the stability of the network in the months to come. One of them is the recent introduction of priority fees, which should reduce the amount of transaction spam on the network.

Federa also mentioned Firedancer, a new validator client that is expected to go live on Solana’s mainnet by the end of 2023.

To find out more about how Solana is recovering after the FTX collapse, check out the full interview on our YouTube channel, and don’t forget to subscribe!

Transaction Fee