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Bitcoin And Ethereum Fees Increased Amid Market Rally, With Ethereum Hitting Year-High.
The cryptocurrency market is experiencing significant activity with both Bitcoin and Ethereum reaching yearly highs, resulting in a significant increase in transaction fees. A recent market rally sent Bitcoin reaching its annual peak price of $45,000 on December 5, before settling above $43,000. Following this rise, #IntoTheBlock reported on December 8 that Bitcoin's on-chain activity increased, leading to a more than 60% increase in transaction fees.
#Ethereum also showed significant growth, hitting a yearly high of $2,390 on Friday. This latest milestone comes with daily gains exceeding Bitcoin's incremental rise. Despite Ethereum's success in price and increase in whale dominance – these large holders now own 35% of the total supply – there has been no corresponding increase in new user acquisition for the network.
The increase in Bitcoin's transaction fees has outpaced that of Ethereum, which saw a fee increase of nearly 50%. This fee inflation typically indicates an increasing demand for transactions on each blockchain and often reflects increased investor interest and market activity.
The market is closely monitoring these developments as both cryptocurrencies are performing strongly. The increase in fees underscores the rising costs associated with increased demand for blockchain space, especially during market rallies. Investors and users are now navigating an environment where increased activity can lead to higher costs for transacting on these networks.
