Bitcoin Miners Have Raked in Abnormal Transaction Fees Since Halving: Bernstein

Every four years, the production of new bitcoins is cut in half, which reduces the increase in the overall bitcoin amount. This event took place last Friday evening.

Analysts Gautam Chhugani and Mahika Sapra explained that the surge in this area is primarily due to retail traders creating new tokens, often meme tokens, through speculative activity.

Over the weekend, the introduction of the Runes protocol enabled users to engrave and issue tokens onto the Bitcoin blockchain. This event resulted in an increase in transaction fees on the network.

The report revealed that mining earnings now amount to roughly three times the previous level, approximately 22 bitcoins opposed to 7 bitcoins prior. Notably, daily income surpassed $100 million, with over $80 million stemming from transaction fees – a significant deviation, according to Bernstein’s observation.

“The fees mentioned here shouldn’t be assumed to continue indefinitely. Instead, they reflect the degree of engagement from Bitcoin developers and represent potential earnings for miners on the blockchain.”

The broker points out that the launch of Runes tokens has primarily been driven by speculation and meme culture up until now. This type of hype might not last long.

Despite the vast potential of the fungible token market on the Bitcoin network being mostly unexplored, according to the report, the value of decentralized tokens and other utility tokens on the Ethereum network surpasses $200 billion.

The note estimates that approximately one-seventh of mining revenues will go toward network transaction fees, with this being a long-term average. It’s important to note that heightened market speculation on blockchains can persist for 6 to 18 months, potentially allowing miners to reap above-average profits during this time.

Read more: Bitcoin Miners May Shift Focus to AI After Halving, CoinShares Says