Bitcoin starts week below $29K as BRC-20 craze ramps up network congestion, fees

Bitcoin ( BTC-USD ) started the week on a sour note, trading below $29K on Monday, as meme coins flock to the BRC-20 standard, resulting in increased network congestion and transaction fees. BRC-20 is a token standard on the bitcoin ( BTC-USD ) blockchain, through which developers can create fungible tokens via the Ordinals protocol (which allows creation of bitcoin NFTs). Over 11K tokens have been minted using the BRC-20 standard, with the total BRC-20 market cap crossing $916.2M, according to OrdSpace . "One major factor that has been affecting bitcoin ( BTC-USD ) sentiment recently is the recent momentum for BRC-20 tokens, which led to an increase in gas prices and caused some disruption to the larger economy," said Eric Chen, CEO of DeFi R&D firm Injective Labs. Chen noted that Binance halting BTC withdrawals twice within 24 hours resulted in some panic selling. "Despite this temporary selling pressure, the general outlook for BTC is still positive. One reason is the anticipated interest rate reduction environment, which is likely to increase the appeal of BTC as a store of value." Bitcoin ( BTC-USD ) fell 3.7% to $27.88K as of 1 pm ET, while ether ( ETH-USD ) slipped 2.9% to $1.86K. "BTC still struggles to push above the overhead resistance area between ~$27K-$31K," said Julius de Kempenaer, senior technical analyst, StockCharts.com. "A decisive move beyond overhead resistance remains the trigger for a renewed BTC rally. The longer this takes, the more risk is opening up on the downside." Crypto-related stocks trading in the red include: Riot Platforms ( RIOT ) -7.8% , Marathon Digital ( MARA ) -8.4% , Bit Digital ( BTBT ) -4.7% , Hut 8 Mining ( HUT ) -4% , Bakkt ( BKKT ) -3.4% . The overall crypto market cap stood at $1.15T, 3.1% lower than Sunday, according to CoinMarketCap . More on Crypto Bitcoin: Flash Crash & A Look At The Fundamentals Ethereum's Hard Fork Raises Regulatory Stakes The State Of Crypto ETFs In 2023 3 Altcoins To Consider In 2023