Bitcoin (BTC) Transaction Fee Shoots to 3-Year High Hinting Strong Network Demand

Bitcoin (BTC) has faced strong volatility this week. However, the BTC price has faced rejection at $30,000 and is currently trading close to the $28,500 level.

In an interesting development over the last week, there’s been a huge spike in the transaction fees on the Bitcoin network. The Bitcoin network transaction fees are currently at the highest in nearly three years since July 2021. This indicates that there’s a strong demand for the Bitcoin blockchain network.

Popular crypto analyst Will Clemete explains that if the transaction fee is high even during the bear market, it would shoot much higher as the bull market resumes. He wrote:

If transaction fees are this high in a bear market (whether from Ordinals or not) they might reach a level in the bull market that creates serious demand for L2s. Pair this with some exciting new integrations/applications, we might begin to see the lightning network truly grow.

Bitcoin Investors to Closely Watch FOMC Development

All eyes will be on the FOMC event scheduled on Wednesday, May 2. The commentary from the Federal Reserve will determine the next price movement for Bitcoin and the global markets.

As per market expectations, the Fed is likely to announce another 25 basis rate hike. However, considering the fresh turmoil in the market with the fall of the First Republic Bank, it’s unclear whether the Fed would reconsider its further rate hike decision.

Over the last 24 hours, the BTC price has jumped by 2% and is currently trading at $28,589 with a market cap of $553 billion. However, Bitcoin needs to convincingly break past $28,700 levels to confirm a bullish trend. Failing to do so will keep the gates open for a fall to $27,000.

Along with Bitcoin, other altcoins are also showing signs of mild recovery with Ethereum (ETH) gaining by 2% and other alts jumping in similar magnitude.