Key Point

• Bitcoin network transaction fee up to a record high after BRC-20 mints cause connection on the network 
• BRC-21 and Lightning network are now being considered

BRC-20 appears to have taken over the Bitcoin network by storm to the extent that Binance had to slam brakes on Bitcoin withdrawals two times in 12 hours, and that wasn’t enough, the transaction fees on the Bitcoin network have also surged to a record high, with Bitcoin transaction fees going as high as $26 per transaction.

Why the Congestion?

In 2022, Ordinals Protocol launched arbitrary contents(which may be text or images) otherwise known as inscriptions which can be added to sequentially numbered satoshis to create NFTs, however, the same Ordinals are now used to mint BRC-20s, and eventually, the tokens became more popular, and the fact that tokens can be minted stupendously on the blockchain resulted in the Bitcoin network congested and the soaring transaction fees.

As of writing this, there are more than 14,000 of such tokens with many being meme coins, all with a market cap of roughly $541 million.

Lightning Network and BRC-21 to the Rescue?

Both users and many exchanges are looking to explore alternatives as transaction fees on the Bitcoin network soar to a record high due to congestion of the network.

Bitcoin Lightning network is now seen as a better alternative to carrying out transactions using Bitcoin, Lightning Network is a layer 2 Bitcoin payment protocol built on the Bitcoin blockchain, it enables fast, cheaper and seamless transactions using Bitcoin. No wonder Binance said its team is looking to integrate the network into its platform.

Furthermore, amid the current network congestion, a new network has been suggested called BRC-21, currently, BRC-21 is being considered as an alternative, according to reports, the process of developing BRC-21 is underway.

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