Bitcoin fees have surpassed Ethereum fees for three consecutive days as miners and traders prepare for the approaching Bitcoin halving and the potential launch of Runes on Bitcoin. On April 17, Bitcoin miners earned $7.47 million in fees, surpassing Ethereum stakers, who received $7.31 million, according to Crypto Fees.
Bitcoin miners also earned higher fees of $9.98 million and $5.91 million on April 15 and 16, respectively, surpassing Ethereum stakers by $3.5 million and $1.1 million on those days.
Despite this, Ethereum maintains a narrow lead in terms of 7-day average fees, with $8.55 million compared to Bitcoin’s $7.57 million.
Bitcoin transaction fees are influenced by the size or data volume of transactions and the demand for block space during transaction requests.
The rise in Bitcoin fees comes at an important time for miners as the Bitcoin halving event on April 20 will reduce the mining reward from 6.25 BTC to 3.125 BTC, leading to a significant reduction in miner revenue.
Currently, about 900 Bitcoins are mined daily, generating around $57.2 million at current prices. Using the fee count from April 17, transaction fees made up 11.5% of the total block rewards for the Bitcoin mining industry.
After the halving, the share of block rewards from transaction fees will rise significantly as approximately 450 Bitcoin will be mined daily. Miners will therefore need to rely more on higher fees and a continued increase in Bitcoin’s price to offset the revenue decline caused by the halving.
Meanwhile, the emergence of NFT-like Ordinals inscriptions in January 2023 has helped Bitcoin miners earn more revenue from transaction fees. The upcoming launch of Runes, a new Bitcoin token standard, coinciding with the halving event at block 840,000, will provide another revenue stream for miners.
Runes will compete with Ordinals by offering a more efficient way to create fungible tokens on Bitcoin for memecoin enthusiasts and other community-driven audiences. Its creator, Casey Rodarmor, asserts that Runes are fully UTXO-based and should not burden the Bitcoin network as much as Ordinals.
Runes were built for degens and memecoins, but the protocol is simple, efficient, and secure. It is a legitimate competitor to Taproot Assets and RGB.
The protocol is self contained and has no dependencies on ordinals or inscriptions, making it extremely simple.
Balances are…
— Casey (@rodarmor) April 1, 2024
The recent increase in Bitcoin fees may be partly due to a decline in BRC-20 token prices, as some traders shift their attention to Runes.
Ordinals (ORDI) and Sats (SATS), the two largest BRC-20 tokens by market capitalisation, have experienced declines of 38% and 43%, respectively, over the last week, according to CoinMarketCap.