Although the crypto market is meant to be decentralized, analysts and commentators believe that a small number of whales may be pulling the strings in the background. The latest reports showed a $1 billion Bitcoin (BTC) transaction executed by one of the whales. However, that particular transaction did not become conspicuous due to its size. It became famous since the sender spent a lot of funds on the transaction fees.
Sending 94k Bitcoins can cost $35
Social media users were left guessing the origin and destination of the funds sent on Sept. 6. That transaction featured 94,504 BTC translating roughly to $1.018 billion. According to Whale Alert monitoring resource, the transaction never involved known wallets. The wallets also never belonged to a particular crypto-related organization, for example, an exchange.
🚨 🚨 🚨 🚨 🚨 🚨 🚨 🚨 🚨 🚨 94,504 #BTC (1,018,147,922 USD) transferred from unknown wallet to unknown wallet
— Whale Alert (@whale_alert) September 6, 2019
One theory implied that these funds could be tied to the institutional trading platform, Bakkt, which starts accepting client deposits on September 6.
Deposit for BAKKT wallet
— Mr G (@MusaShamaev) September 6, 2019
Max Keiser commented on the giant transaction:
“Institutions building inventory for their market-making needs going forward.”
Institutions building inventory for their market-making needs going forward. This = effective ‘put’ on the BTC price at $9,000 (as I’ve been reporting for several yrs now). Ie, institutions are net-buyers of any BTC that shows up at $9k. Risk/reward now for buyers is excellent. https://t.co/up7irZufX6
— Max Keiser, tweet poet. (@maxkeiser) September 6, 2019
It might be the sender who may have been sending these coins to themselves which nonetheless chose a very high fee rate. The fee totalled to almost $700 at 480 satoshis per byte.
The Bitcoin fees vary subject to the speed with which the sender wishes a transaction to be processed by the miners. Most wallets permit manual fee-setting; the more money that is paid in form of fees, the fewer the blocks the sender must wait for a transaction confirmation.
In the current conditions, having a transaction included in the next block that takes up to ten minutes is just 23 satoshis per byte. That means the sender, in this case, overpaid 20 times. The funds might have settled in just 10 minutes if the sender paid a fee of $35 only.
Bitcoin’s Low Transaction Fees Thriving
The transaction fees have remained considerably low in spite of Bitcoin’s rapid rise in price this year. The situation is a stark contrast to 2017 when the biggest crypto circled all-time highs and fees grew in step. At that time, developers of projects like the contentious Bitcoin Cash targeted to take users away promising lower fees.
The total hash rate of Bitcoin continues to surge and has now surpassed 1000% of what it was in September 2017.