Approximately $2.4 million was paid in Bitcoin fees by users, amounting to 37.7 Bitcoins (BTC), for securing a place in the fourth Bitcoin halving block with restricted capacity.
Around 12:09 am UTC on April 20, Bitcoin miner ViaBTC created the 840,000th block in the Bitcoin network. This event activated an automated process, reducing the reward for miners from 6.25 Bitcoins to 3.125 Bitcoins per block.
In simple terms, block 840,000 gained immense popularity in the Bitcoin community as the go-to premium digital property, resulting in a collective investment of 37.67 BTC in transaction fees based on information obtained from the Bitcoin block explorer mempool.space.
With the addition of the miner subsidy amounting to 3.125 BTC, a grand total of 40.7 BTC, equivalent to approximately $2.6 million, was remunerated to Bitcoin miner ViaBTC upon generating the block during the halving event.
The extraordinary fees setting new records were caused by people hurriedly recording and engraving scarce satoshis onto the “halving block” – a significant portion of this frenzied behavior originated from the launch of Casey Rodmarmor’s new Runes Protocol for Bitcoin Ordinals, which coincidentally went live during the same halving event.
The use of Runes is promoted as a faster approach for generating fresh tokens in the Bitcoin system versus the BRC-20 token protocol, which employs Ordinal technology.
Runes function in a manner similar to BRC-20s by utilizing the Bitcoin network and requiring payment of fees in Bitcoin to generate new tokens. However, they differ significantly in their approach. Unlike BRC-20s, which operate using an account model called “inscriptions” according to Rodarmor’s protocol explainer, Runes employ an Unspent Transaction Output (UTXO) model for creating new tokens on Bitcoin.
In a blog post on X dated April 20th, an anonymous Bitcoin developer named Leonidas from Ordinals stated that the transaction fees on the five most current Bitcoin blocks after block 840,000 exceeded the rewards given by Coinbase for mining those blocks.
“Leonidas noted that rune degenerates alone prevented the decrease in mining rewards due to the halving,” or “The mining reward reduction caused by the halving was counteracted solely by the rune degenerates, according to Leonidas.”
Approximately $3.82 million in fees, not including miner rewards, were paid for the five transactions that occurred after the halving event, based on information compiled from mempool.space.
Outside of the competition to record one of the initial Runes, Bitcoin mining pools were also trying to secure the highly coveted “first-ever” satoshi. A satoshi being the tiniest fraction of a Bitcoin unit, the very first one mined on the halving block is referred to as an “epic satoshi.”
On April 15, Trevor Owens, managing partner at The Bitcoin Frontier Fund, announced his intent to offer a reward of $500,000 to $1 million for purchasing ownership of the very first Bitcoin block.
Crypto X reacts to the Bitcoin halving
In the midst of the confusion, an anonymous trader named Hsaka shared a meme expressing the common feeling towards the halving event: a quick burst of excitement, only to be followed by resuming regular activities.
Peter Schiff, a vocal critic of Bitcoin, used X to cast some disparaging remarks towards Bitcoin supporters during the halving occasion.
“Schiff believes that ‘halving’ is a fitting term for the upcoming event, as Bitcoin owners will see a reduction by half in their wealth.”
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2024-04-20 05:21