- The $184 million payout marks a remarkable 270% surge from the first quarter of 2023.
- Macroeconomic conditions were favorable for miners, such as decreasing inflationary pressures, were favorable for miners in Q2.
According to the latest “State of the Network” report by Coin Metrics, Bitcoin miners experienced a significant boost in earnings from transaction fees during the second quarter of this year. The report reveals that miners earned a staggering $184 million, surpassing their total earnings for the entirety of 2022. This substantial increase can be attributed to Bitcoin’s soaring price and the emergence of BRC-20 tokens.
The $184 million payout marks a remarkable 270% surge from the first quarter of 2023 and signifies the first time since Q2 2021 that transaction fees have exceeded the $100 million milestone.
Coin Metrics attributes this surge in fees to Bitcoin’s recent price hike, which has bolstered top-line revenue for miners. Additionally, the introduction of BRC-20, a new tokenization standard in March, has provided further opportunities for revenue generation.
BRC-20 tokens enable novel use cases for Bitcoin’s core transaction types and facilitate the scalability of the network through the Lightning Network. This new standard has captured the interest of users, further driving transaction fee revenue. However, it is important to note that transaction fees accounted for only 7.7% of the total $2.4 billion earned by miners during the quarter.
The remaining portion of earnings came in the form of block rewards. Currently, miners receive 6.25 BTC for each block they successfully mine. However, this reward will halve to 3.125 BTC after the network’s next halving cycle, scheduled for May.
Despite this impending reduction, the report emphasizes that the macroeconomic conditions were favorable for miners in the quarter, with decreasing inflationary pressures leading to lower electricity prices, particularly for miners based in the United States.
Coin Metrics also highlights the fierce competition in the mining sector, with Bitcoin’s hashrate reaching a new high of 375 EH/s during the quarter. The adoption of advanced ASICs like the S19 XP has contributed to the overall network’s efficiency.
While the report acknowledges that the enthusiasm surrounding BRC-20 tokens has subsided, resulting in lower payout amounts related to transaction fees, miners continue to enjoy substantial earnings. Coin Metrics states that these earnings remain robust compared to previous years.