## Current State of Bitcoin Transaction Fees
The Bitcoin network is currently experiencing a notable increase in transaction fees, reaching its highest annual levels. According to the latest data:
- The average transaction fee reached $38 per transaction, the highest level in 2025.
- This increase in fees reflects severe congestion on the network due to increased demand for block space.
- Activities like Ordinals and BRC-20 tokens have increased pressure on the network and raised fees.
## Supply Concerns and Potential Price Increases
Recent data indicates concerning trends regarding Bitcoin supply:
- The "illiquid supply" of Bitcoin (BTC that has remained inactive for a long time) has reached an all-time high.
- This indicates a decrease in the amount of Bitcoin available for trading on exchanges.
- If demand continues to rise, this could lead to a supply shock that drives prices to new highs.
## Other Factors Affecting the Bitcoin Market
### Recovery of Bitcoin's Market Dominance
- Bitcoin's market dominance has shown signs of recovery after a previous decline.
- This suggests that the recent short-term decline compared to other cryptocurrencies may be due to temporary liquidity factors rather than a structural shift towards "altcoin season."
### Regulatory Developments
- The U.S. Senate is expected to vote soon on the Genius Act, a bipartisan bill to regulate stablecoin issuers.
- Cryptocurrency-friendly legislation may create a more favorable regulatory environment, encouraging further institutional participation.
### Institutional Forecasts
- JPMorgan has changed its stance on Bitcoin and issued predictions that it may reach $150,000 by the end of 2025.
- Factors driving this outlook include increased institutional adoption, reduced selling pressure from miners, and cryptocurrency policy momentum at the state level.
## Recommendations for Investors
In these circumstances, investors should:
1. Monitor Liquidity Indicators Track the amount of Bitcoin available on exchanges as a key indicator of potential supply pressures.
2. Timing Transactions Consider conducting transactions during periods of low network congestion to avoid high fees.
3. Leverage Layer 2 solutions using the Lightning Network for small and recurring transactions to avoid high fees on the main network.
4. Monitor Regulatory Developments Stay informed about changes in the regulatory environment that may affect the cryptocurrency market.
5. Diversify the Portfolio Consider allocating a portion of investments to altcoins while maintaining core exposure to Bitcoin.
## Future Outlook
With current supply trends persisting and increasing demand, we may witness:
- Further upward pressure on Bitcoin prices.
- Continued volatility in transaction fees as demand on the network fluctuates.
- Increased adoption of scaling solutions like the Lightning Network to alleviate congestion.
- Greater impact of regulatory developments on investor confidence and capital flows.
Market participants should remain vigilant to these factors as the dynamic landscape of cryptocurrencies evolves.#BTC
