Three years ago there were a lot of discussions concerning data embedded in bitcoin transactions and the block size space consumed by these OP_Return transactions. However, in recent times, the use of OP_Return transactions has dropped a great deal and the trend has lowered network fees to some degree.
Thorn’s report explains there are a number of reasons why fees are lower including the use of transaction batching, increased Segregated Witness (Segwit) adoption, and Lightning Network usage. Another trend Thorn’s report covers is the fact that OP_Return transactions have declined. The researcher notes how after 2018, following the launch of Veriblock, the use of storing arbitrary data on the Bitcoin blockchain spiked.
In recent times, however, OP_Return transactions stemming from the likes of Veriblock and Tether via Omni are down. The Galaxy Digital Research study explains how most tethers have moved off the Omni Layer network that uses OP_Return transactions to alternative chains. While Thorn’s report briefly mentioned the spike in OP_Returns after Veriblock it doesn’t mention how controversial storing arbitrary data on the Bitcoin blockchain was at the time.
Besides Veriblock, between 2018 and December 2019, the top publishers of OP_Return transactions stemmed from Omni/Tether, Factom, Komodo, Blockstore, po.et, Chainx, and RSK. Nowadays, while many of these projects still exist, they are not producing as many OP_Return transactions as they were in the past. Of course, there’s a chance the use of OP_Return outputs dominating BTC transactions could happen again. While reports like Thorn’s study and current data show OP_Return transactions have lowered, there’s no clear explanation for why this has happened.
What do you think about the decline in Bitcoin OP_Return transactions in recent times? Let us know what you think about this subject in the comments section below.