Bitcoin transactions return to dominate the blockchain after the halving

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For the first time since the halving in April, BTC transactions have once again dominated the Bitcoin blockchain. 

This is what emerges from a chart published on Dune that shows the daily percentages of different types of transactions on the Bitcoin blockchain.

Non-BTC transactions

With the latest update of the Bitcoin protocol, which took place a few years ago, the possibility of recording on its blockchain also transactions that do not contain BTC has opened up. 

The chart published by the user cryptokoryo on Dune divides them into four categories: BTC, ordinals, brc-20 and rune.

The BTC transactions are obviously the classic transactions in which Bitcoin are sent from one address to another. 

The Ordinals are a kind of NFT on the Bitcoin blockchain, while the BRC-20 are tokens that can be traded on the Bitcoin blockchain.

Rune instead is a new protocol that in fact replaces Ordinals and BRC-20 starting from the halving.

The chart indeed shows the various daily percentages of the different types of transactions that are recorded every day on the blockchain of Bitcoin.

Before the halving on April 20, there were no Rune transactions, while after the introduction of this protocol, the daily number of Ordinals and BRC-20 transactions collapsed, becoming practically irrelevant. 

So the non-BTC transactions until the halving were the sum of those of Ordinals and BRC-20, while after the halving they are almost exclusively those of Rune. 

Bitcoin Blockchain: The boom of non-BTC transactions post halving

At the beginning of 2024, there were already more than 20% of daily non-BTC transactions on the Bitcoin blockchain. 

After the launch of spot Bitcoin ETFs on the US exchanges, this percentage for a brief moment skyrocketed above 70%, with a peak even above 75%, only to return to 30% a few days later. 

In February and March there were no significant deviations, except for very short periods, but after the introduction of the Rune protocol with the halving on April 20, non-BTC transactions increased again.

For a few days they returned above 70%, with a daily peak even above 80%. 

However, these high percentages have never been recorded for more than four consecutive days, but starting from the end of May there was a new surge, after a return to normality a few weeks after the halving. 

In particular, from May 22 to June 15, they slowly increased from less than 20% to more than 60%. This rise is almost exclusively due to Rune transactions. 

Since June 16, however, the situation seems to have returned to normal, with even today a percentage of non-BTC transactions on the Bitcoin blockchain falling back below 10%. 

It should be noted that these fluctuations are not due to strong variations in the number of BTC transactions, but mainly to strong variations in the number of non-BTC transactions. 

The fees on the Bitcoin blockchain after the halving

Due to this latest dynamic, an increase in non-BTC transactions is often followed by an increase in fees. 

Excluding the anomalous peak on the day of the halving (128$ average fee per transaction), due to the launch of Rune, the fees at the beginning of May had returned more or less to normal. In fact, shortly after the middle of the month, they had even dropped below 2$. 

Starting from the end of May, however, they started to rise again, with a new peak on June 7th above 87$. This rise was also caused by the recent small boom in Rune transactions. 

Already on June 9, however, they had fallen below $7, and for three days they have also been below $4. 

It should be noted, however, that the average amount per transaction is currently over $65,000, so the average fee data per transaction is actually not very indicative. 

It is instead advisable to take the median as a reference, and not the average, also because the median amount per transaction is less than 200$. 

The median of the transaction fees on the day of the halving had skyrocketed above $90, but then it had dropped below $1. The second peak, the one in June, stopped at around $6, while in the last two days it has returned below $2. 

These numbers are still much higher compared to those of other blockchains, and especially to those of the layer-2 of Ethereum, but on the other hand, even on the main layer-2 of Bitcoin (Lightning Network) these numbers are far lower.

The return to normality

From this point of view, periods of normality alternate with brief mini-bubbles, during which the number of non-BTC transactions skyrockets. 

Generally, these are very brief and rapid surges, lasting at most a few days, but the slower one at the end of May and the beginning of June lasted for a few weeks. 

However, when these mini.bubbles run out, things return to normal, and currently, normality is a daily percentage of non-BTC transactions below 20%, and median fees below $2. 

It is very likely that sooner or later other mini-bubbles of this kind will occur, so it is advisable to carry out transactions in BTC when the situation is normal, and not when there are peaks of non-BTC transactions.