What is the outcome when there is "Network Congestion" (i.e., stalled or slowed transactions) on a Blockchain!?
For example, sometimes when trying to send a token/coin from an exchange to your wallet—or the other way around from your wallet to an exchange—you might see a message like: "NETWORK CONGESTION."
In this post, I'll explain:
What is it?
What to do if you experience it?
Network Congestion happens when the amount of transactions exceeds the processing capability of a blockchain at any given moment. This is usually when a large number of users are attempting to communicate with the blockchain simultaneously.
Every blockchain in the world has a limit to how much they can process within a specific time frame.
There's this term in a blockchain called TPS (Transactions Per Second), and it defines the number of transactions that a blockchain can do per second.
Example (at the time of writing):
Bitcoin can only do 4.3 TPS
Ethereum can do 15.6 TPS
Solana can do 4,548 TPS
BNB Chain can do 70.5 TPS
As I highlighted above, every blockchain has a different TPS limit. And TPS is not fixed it can increase or decrease depending on activity levels at any given time.
For example:
Bitcoin can go up to 8 TPS sometimes
Solana can go up to 10,000 TPS sometimes
Same with Ethereum, BNB, and others
It depends on how much activity is happening on the blockchain.
Causes of Network Congestion:
Increased Adoption:
Assume a large country adopts BNB Chain as its primary infrastructure. The more people join the network, the more crowded it will be.
Events:
For instance, assume a new token is launched on the TON blockchain and many people buy and sell at the same time. This can exceed the network's capacity, causing TPS to drop and hence resulting in Network Congestion.
A real-world example:
When the $NOT token launched on TON, there was congestion as too many people transacted simultaneously. The network was not able to cope and led to transaction failures and very high gas fees.
Another example is when they listed the U.S. Bitcoin ETF. There was heightened Bitcoin transaction activity, and again, it led to transaction failures and high fees.
This happens to all blockchains, not just $TON $SUI or Solana. Even Bitcoin and Ethereum can experience it.
Consequences of Network Congestion:
When there is too much traffic:
Transaction fees increase
Transactions fail or are slow
Does that mean transactions reverse?
Not at all.
Blockchain doesn't reverse transactions. What happens is your send attempt may not go through. This is different from a reversal.
When you make a transaction, it is broadcast to a waiting area briefly a section called the Mempool in Bitcoin. It then waits for any validator that meets the network requirements to validate it.
If too many transactions are waiting at once, yours may be slowed down and can even fail.
Why Do Fees Increase When It Becomes Congested?
Blockchains are designed to prioritize transactions that pay more in fees.
So if normal fee is $1, during congestion it may increase to $1.5.
Let's say your transaction fee is $1.5, and mine is $2:
Your transaction can be processed in 1 minute.
Mine can be done in 30 seconds, as I paid more so mine gets preference.
If there is no congestion, both can be done at the same time.
This is how blockchain prioritization occurs.
Important Notes:
Blockchain is "censorship-resistant" in nature, meaning nobody can shut it down.
If a blockchain is congested, that's the system functioning as designed it doesn't mean that someone is attacking or disabling it.
If you're facing congestion, you can either:
Wait for the congestion to clear, or
Send the transaction anyway if it's urgent (and perhaps pay higher fees)
Blockchain isn't a bank where your money is trapped and you need to fill out a form to retrieve it.
If a transaction goes through, it goes.
If it doesn't, it doesn't—simple as that.
Important Clarification:
If you are sending a coin from MetaMask (wallet) to an exchange, and it has departed your wallet but not arrived at the exchange yet, here's what you need to know:
It has departed your wallet
It has arrived at their wallet
But they (the exchange) haven't credited your account internally yet
So the issue is with the exchange, not the blockchain.
It's very important to know the difference between CEX (Centralized Exchange) and DEX (Decentralized Exchange) and how they work.
Insha allah I'll make a post about that soon.
