Bitcoin

On-chain activity: Bitcoin’s Fee Ratio Multiple drops as price rises

Quick Take

  • The Fee Ratio Multiple provides a framework to examine how secure chains will be once their block rewards disappear
  • With the recent price increase, Bitcoin’s FRM has reached a 15-month low

What is the Fee Ratio Multiple?

The Fee Ratio Multiple (FRM) was created by The Block’s analyst, Matteo Leibowitz, as a way to measure the security of a Proof-of-Work chain. The metric provides a framework to examine how secure chains will be once their block rewards disappear. In other words, how many multiples of the current transaction fees would be required to maintain a chain’s current level of security.