Bitcoin’s Ordinals, Runes key to solving the mining subsidy problem: ViaBTC

As an experienced cryptocurrency analyst, I believe that the emergence of new transaction fee-generating applications like Ordinals, Runes, and BRC-20s will be crucial for Bitcoin miners’ sustainability as more halving events occur. The Bitcoin network’s growth in use cases and user base has significantly impacted miners’ fee income from on-chain transactions.

According to a mining pool in the cryptocurrency world, transaction fees from applications like Ordinals, Runes, and BRC-20s will play a crucial role in keeping miners engaged as more bitcoin halving events take place.

“The development of the Bitcoin network has resulted in a broadening range of applications and a larger user community, which in turn has significantly influenced the fee income miners derive from on-chain transactions.” (ViaBTC shared this insight with CryptoMoon during a recent interview)

Before the Ordinals protocol went live in January 2023, miners primarily depended on transaction fees paid between individuals to supplement their income from block rewards. These rewards are reduced by half every 210,000 blocks and significantly influence miner revenue over time, according to ViaBTC.

The price surge of Bitcoin (BTC) can lead to an uptick in mining income. However, more advancements in the application layer will boost network usage, expand Bitcoin’s functionality, and generously reward miners through increased transaction fees. According to ViaBTC.

On April 20, ViaBTC encountered this situation directly when they successfully mined the coveted halving block, specifically block 840,000. This event came with an unusually high transaction fee of 37.6 BTC, equating to a significant value of approximately $2.4 million at that moment in time.

As a crypto investor, I reaped a reward of 40.7 BTC from the latest batch, taking into account the fresh 3.125 BTC block incentive. This bounty emerged during the memecoin and NFT community frenzy, as they strived to etch “rare satoshis” and standard tokens using the novel Runes token standard, which debuted at the Bitcoin halving event.

Bitcoin’s Ordinals, Runes key to solving the mining subsidy problem: ViaBTC

ViaBTC predicted to CryptoMoon that transaction fees would surpass the thresholds of 30, 40, and 50 BTC eventually. However, they didn’t anticipate being the ones to reap such substantial benefits from this trend, especially not around the time of the Bitcoin halving.

As a crypto investor, I’ve noticed an intriguing trend since the Bitcoin halving. On that day alone, Bitcoin miners pocketed a staggering $78.3 million in rewards. What’s more, they’ve outperformed Ethereum stakers and Uniswap liquidity providers in terms of fees income in no less than nine days out of the last twenty. According to Crypto Fees, this is the current state of affairs.

Bitcoin’s Ordinals, Runes key to solving the mining subsidy problem: ViaBTC

The mysterious creator of Bitcoin, Satoshi Nakamoto, foresaw that transaction fees would eventually serve as the primary income for miners once the block reward shrinks, according to ViaBTC’s observation.

“Should these transactions gain wider application in the future and undergo notable technological improvements, they could attract more interest and acclaim,” ViaBTC stated.

The popularity of Ordinals inscriptions, Runes, and BRC-20s has seen significant ups and downs since their introduction, resulting in volatile miner revenue.

As a data analyst, I’d put it this way: Since its inception in 2016, ViaBTC has gone through three bitcoin halving events. The 37,534th block that we mined was block 840,000 in our 2,900-day tenure.

The mining pool’s hash rate is sourced from miners in 118 countries.

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2024-05-10 05:19