(BTC) miners earned $184 million from transaction fees in the second quarter of 2023.
- This payment amount reflects an increase of over 270% from the first quarter of 2023.
- This figure is more than five times the fees earned in the previous five quarters (from the first quarter of 2022 to the first quarter of 2023).
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Bitcoin miners earned millions of dollars in revenue from transaction fees in the second quarter of 2023: Is it due to BTC-20 and Ordinals effect?
Miners Earned Over $180 Million
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Bitcoin (BTC) miners earned $184 million from transaction fees in the second quarter of 2023. This amount is significantly higher than the amount earned by miners throughout 2022. This finding is based on a report published by cryptocurrency analytics platform Coin Metrics.
The second quarter of 2023 is the first quarter to exceed the $100 million threshold since the second quarter of 2021. The $184 million payment amount reflects an increase of over 270% from the first quarter of 2023. In fact, this figure is more than five times the fees earned in the previous five quarters (from the first quarter of 2022 to the first quarter of 2023).
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However, transaction fees account for only 7.7% of the total $2.4 billion earned by miners in the last quarter. The report attributed this increase in transaction fees to Bitcoin’s recent price rally and the introduction of the BRC-20 token standard and Ordinals.
BRC-20 and Ordinals Benefit Bitcoin Miners
BRC-20 was announced in March 2023. Ordinals enables the production and transfer of divisible tokens on the Bitcoin network using Ordinals scripts. This new token class is similar to Ethereum’s (ETH) ERC-20 token standard. Since its introduction, the market value of BRC-20 tokens has exceeded $240 million.
Bitcoin Ordinals was launched in January 2023. Ordinals is a Bitcoin protocol that allows people to create NFT-like assets by writing data to the network. Satoshi is the smallest unit of Bitcoin that can be divided, equal to 1/100,000,000 of 1 BTC.
The report noted that miners benefited from better macroeconomic conditions, including falling energy prices due to “waning inflationary pressures” for U.S.-based miners. According to the report, the payment amounts related to transaction fees have decreased as the excitement around BRC-20 tokens has waned. However, the compensation miners receive from transaction fees is still significant. Nevertheless, competition in the mining market is intensifying as Bitcoin’s hash rate continues to reach new highs over the past 12 months.