The Bitcoin network is grappling with a surge in transaction fees, reaching nearly $52 per transaction due to a significant backlog of unconfirmed transactions. As of June 7, at 12:05 pm Eastern Time, the network had 332,000 pending transactions, causing congestion and driving up fees.

The transaction fees spiked to 514 satoshis (sats) for high-priority transactions and 513 sats for low-priority transactions, with a peak of around 520 sats earlier in the day. This translates to $50-$52 in fees per transaction. While priority fees have since decreased to approximately $46 per transaction, the congestion remains a concern.

Blockchain journalist Colin Wu speculated that the influx of unconfirmed transactions might be due to centralized exchange OKX processing and organizing wallets, though this had not been verified by the time of publication.

The rising transaction fees highlight the broader issues faced by the Bitcoin network post-halving, particularly concerning miner difficulty, network fees, and miner profitability. The recent halving event at the end of April reduced the block reward from 6.25 BTC to 3.125 BTC, significantly impacting miner revenue.

For instance, Bitfarms reported a 42% drop in mining revenue for May, earning 156 BTC compared to 269 BTC in April. The company attributed part of the decline to adverse weather conditions in Argentina, which forced the shutdown of its Rio Cuarto facility for eight days.

The increased computational difficulty and lower rewards post-halving have exacerbated the challenges for Bitcoin miners. Since the start of 2024, U.S.-based Bitcoin miners have collectively spent $2.7 billion on electricity. Analyst Paul Hoffman noted that Bitcoin mining consumed 20,822.62 GWh of electric power in the U.S. this year, enough to power 1.5% of U.S. households for an entire year.

The cost of mining a single Bitcoin has surged from an average of $52,000 in April to over $110,000 following the halving event, reflecting the increased operational expenses and reduced profitability for miners.

As the Bitcoin network continues to navigate these challenges, the implications for transaction fees, miner sustainability, and overall network performance remain under close scrutiny by industry stakeholders and market participants.