What causes high transaction fees in Bitcoin?

High transaction fees in Bitcoin are primarily caused by network congestion. When the number of transactions waiting to be processed exceeds the network’s capacity, users compete by offering higher fees to get their transactions confirmed faster. This competition drives up the fees.

Another factor is the block size limit of 1 MB, which restricts the number of transactions that can be included in each block. During peak times, this limitation leads to a backlog of unconfirmed transactions, increasing fees as users try to outbid each other.

Additionally, miner prioritization plays a role. Miners typically select transactions with higher fees first to maximize their earnings, leaving lower-fee transactions to wait longer, further pushing up the average transaction fee. These combined factors contribute to higher transaction fees in the Bitcoin network.