Bitcoin Transactional Fees Double After BitMEX Exodus

Bitcoin transactional fees have almost doubled Ethereum’s after the CFTC filed charges against BitMEX and users started withdrawing the funds from the exchange as we are reading more in our latest bitcoin news.

Bitcoin transactional fees are on the rise after the BitMEX exodus while Ethereum’s have fallen. The ETH fees are usually higher than the ones of BTC but now it seems that Bitcoin’s fees doubled Ethereum’s. While Bitcoin’s average transaction fees doubled in the past week, the data from BitInfoCharts that Ethereum’s fees are declining. The reason for that could be the recent user withdrawal of funds from BitMEX.

The average cost of processing one BTC transaction which has to be paid to the miners that process each transaction on the blockchain is now $4. A few days ago, the same transaction cost an average of $1.5. The average cost of an ETH transaction increased at the start of the week from $2.3 on Sunday to $3.6 on Tuesday which is an increase of 57%. These fees then declined dramatically and tumbled back to $2.3.

#Bitcoin outflows from BitMEX addresses continue – our data shows that in the past hour another 7.200 BTC were withdrawn.

The total amount pulled from the exchange over the past day is now nearly 40,000 $BTC.

Live chart: https://t.co/jlunNHscY3 pic.twitter.com/i0jtdjBtqG

— glassnode (@glassnode) October 2, 2020

The transaction fees usually increase when there are a lot of people that are moving the cryptocurrency at once, This is because the demand for the miners to process these transactions surpasses the supply so the miners increase their fees. This means that the Bitcoin transactional fees are double the ones of Ethereum but ETH is known for having even higher transaction fees these days. This is a consequence of the Defi boom during which the investors rushed into the network with about $10 billion hoping to gain some rewards that were offered by some ETH-based protocols like Aave, Uniswap, and Compound. The average ETH transaction cost $14 while the average BTC transaction cost $4.6.

Why has now Bitcoin surpassed Ethereum? It could have something to do with the latest BitMEX craze. The United States Commodity Futures Trading Commission filed a money-laundering criminal charge against BitMEX which caused many of the users to start taking their money out of the exchange. BitMEX is the fifth biggest exchange and as Glassnode twitted, the traders withdrew about 40,000 BTC from it or about 1% of all BTC in circulation. The charges filed has the fees rising since the announcement. Bitcoin’s fees were not this high since the end of August.