Bitcoin fees have shot up, nearly doubling over the past few days as the backlog of unconfirmed transactions nears 200,000.
Due to an increasingly congested network capped by the capacity of one-megabyte blocks every 10 minutes on average, transaction fees have quickly spiked. This, combined with a still-resilient price of over $1,800, has resulted in average transaction fees in the several-dollar range:
Crazy. CoinCap.io shows #bitcoin average fee at $3.42
— Jeff Garzik (@jgarzik) May 17, 2017
In addition to fees, the mempool backlog of unconfirmed transaction has reached new heights. To date, around 160,000 transactions remain unconfirmed, a new high.
Bitcoin businesses are feeling the pain
While this exponential fee growth would simply be an annoyance to casual users, it can be deadly to businesses that rely on Bitcoin for day-to-day operations. ShapeShift CEO Erik Voorhees noted that Bitcoin has now become more expensive than traditional banking methods of transacting:
I just sent a fiat wire for @ShapeShift_io, and then a BTC transaction for inventory balancing. The fiat wire was cheaper. 2MB+SegWit please
— Erik Voorhees (@ErikVoorhees) May 16, 2017
The increasingly untenable cost of doing business in Bitcoin has led to businesses searching for another option for transactions. Airbitz CEO Paul Puey recently tweeted that fees were so high he was searching for an alternative to pay his employees more efficiently:
— Paul Puey (@paullinator) May 17, 2017
The use case for Dash has never been stronger
As businesses built around early Bitcoin’s digital cash model struggle to remain profitable, the reasons to switch to Dash, with low fees and instant transactions, keep piling up. BlockCypher, the world’s leading blockchain API service, recently announced a strategic partnership with Dash, opening the door to a host of new business integrations. With businesses adding Dash support week after week, former Bitcoin businesses are quietly switching over. Skyrocketing fees will likely only hasten this process.