What Happens to the Fee Market during a Period of High Network Demand?

During a period of high network demand, the transaction fee market experiences a sharp increase in fee rates. High demand means a large number of users are simultaneously attempting to confirm transactions, creating significant competition for the limited block space.

As the mempool fills up, miners can afford to be more selective, only including transactions with the highest fee-per-byte. This competition drives the effective minimum fee required for timely confirmation upward, leading to higher costs for all users.