Bitcoin transaction fees have seen a significant reduction this week, plummeting by more than 15% to $3.3 million, according to data analytics firm IntoTheBlock.
The number of Bitcoin transactions has also declined over the past week, with a seven-day average of 474,720 transactions.
Highs and lows for the week were 612,460 transactions on Aug. 20 and 399,150 on Aug. 24, respectively.
These fees serve as an incentive for miners, the individuals and organizations that validate and record transactions on the Bitcoin network. In essence, lower fees could imply less profitability for miners but cheaper transactions for users.
In terms of transactions by size, the data shows varying patterns. Smaller transactions ranging from $0.00 to $1.00 saw an increase of 52.10% in the past month.
Meanwhile, the activity for transactions between $1.00 and $10.00 decreased by 28.46%. Larger transactions also witnessed significant declines, including those in the $1,000 to $10,000 range dropping by 21.66%, and transactions exceeding $10 million falling by 41.97%.
Meanwhile, Neon, a cryptocurrency analyst, pointed out that the cryptocurrency market is experiencing its lowest volume in derivative trading since late December 2022. Market sentiment appears to have turned apathetic, erasing earlier leveraged positions.
This shifts the focus to upcoming supply events like the release of 30,000 coins from the Silk Road saga, FTX trading $500 million in major cryptocurrencies and the Mt. Gox bankruptcy case.
These events are expected to impact the market in the short term, as they stand in contrast to demand-side factors such as the prospect of a spot Bitcoin ETF, initiatives from Grayscale and upcoming Ethereum futures ETFs.