92,857 Bitcoin transfer, which is worth more than $1 billion in USD with the current price, has just been done smoothly for a measly fee of $4. This is despite the high mining transaction fee existing in the bitcoin blockchain for the last few days. Despite $4 appearing as too low USD value, the Bitcoin transaction fees have increased by more than 500% in the last month.
Bitcoin, with its high network transaction fee, is only suitable for high value transfers with the highest security standard.
Last we saw a similar high value transaction was in June. Whale activity has increased in the last few days with higher enthusiasm in the crypto space along with the price movement.
$1 Billion USD in Bitcoin Transfer for $4
According to a bot in Twitter that goes with the name Whale Alert, some one with a value transfer of 92,857 BTC emerged. For those who don’t know, it is worth $1 billion dollars in fiat currency. Also, this transaction executed for a paltry fee of $4.
To be honest, even this is a higher fee due to network congestion. Fees will be generally lower when transaction happens in a much less congestion time.
Someone rightly explained this is a custodial wallet from BitGo. This wallet holds Bitstamp cold storage amount. Notably, this change happened in the migration of wallets in Oct 2019.
The Bitcoin transfer fee is a lot lower than the fee that traditional financial institution will normally charge. For such a humongous amount, expect to pay a huge cut in traditional finance. Despite this, the bitcoin transaction fees paid this time is still considerably higher than high value transactions that happened last month or in June, with less than a dollar.
Surge in Bitcoin Transaction Fee
The whole of June and until mid-July, the average transaction fees on Bitcoin was less than $1, irrespective of the value transferred. There is an enormous four fold (4x) increase in transaction fee over the past 20 days. The source for this data is Bitinfocharts 3 month chart.
Continuously growing network usage actually explains the surge in bitcoin transaction fee. It becomes when you glance the charts at Blockchain.com for Mempool size. Mempool depicts transactions in terms of size in bytes, for the waiting for confirmation to happen.
You will see that until mid-July, the unconfirmed transaction count was averaging around 12 million. Today, it is around 50 million. Check bitcoin price today versus mid July. When the blockchain experiences heavy use for transactions and becomes valuable, the network value increases. Hence, bitcoin price goes up.
To summarize, the surge in Bitcoin Transaction fee is because people want the confirmation for their transaction on priority. To achieve that, they pay a higher fee to miners.
Whale Bitcoin Transfer Impact On Price
BTC manages to get the better of several major price milestones. For the first ever time in 2020, Bitcoin breaks the $12,000 USD mark. After that, there was a flash crash of $1500 in a few minutes and then stabilization in price seems to be the norm.
Bitcoin’s current market price is at $11,800 , as of writing this article. In the previous 24 hours time, BTC has a sideways movement effect but manages to put great weekly and/or monthly gains in the charts.
Market capitalization of the number one cryptocurrency is at $218 billion at the time of writing this article. Watch out for more whale activity with bitcoin transfer of high value.