Miners win steadily as Ether GAS revenue breaks $722 million monthly record

Miners will still enjoy record fee revenue until Ether 2.0 is realized.

According to Coin Metrics, May 2021 Ether transaction fees are on the verge of breaking the current monthly record of $722 million sometime today, a full two weeks before May ends.

If this trend continues, the Ethernet network’s second-quarter transaction fee revenue will surpass its first-quarter record by the end of May and is expected to reach $1.7 billion.

GAS revenue, priced in dollars, is the product of transaction fees and the unit price of Ether. Due to the current high demand for the network and the record price of ETH, Ether’s total transaction fees have never been higher.

The previous high point in transaction fees was three months ago, in February 2021.

Miners win steadily as Ether GAS revenue breaks 2 million monthly record

Whenever someone uses the Ethernet network to transfer funds or use smart contracts (automated code that interacts with them, such as bidding on NFTs in an auction or exchanging assets on a decentralized exchange), users must pay a fee, and eventually miners will receive a freshly baked ETH fee, an additional subsidy.

Transaction fees vary depending on network congestion. The more transactions across the network, the higher the GAS fee for transactions will be pulled up if users are willing to pay a premium.

Thus, this month’s record transaction fees are indicative of both network-wide usage and the price of Ether. According to Nomics, ETH reached a new all-time high a week ago, breaking $4,300.

If Ether were a company, as former Ark Investment analyst James Wang imagines, those revenue numbers would be glowing, Wang noted, ” Calculating Ether’s annual revenue at $8.6 billion based on April data is comparable to Amazon Web Services in 2015.” Over the next five years, Amazon Web Services revenue grew by 575 percent, and Ether enthusiasts are hoping for the same.

But that depends on Ether’s ability to scale more businesses. Each block in the Ethernet network can only handle a limited amount of transactions, and the network is nearing its capacity limit. Another record in transaction fees will depend not on the number of more transactions, but on the rising price of ETH and the willingness of users to pay higher GAS fees to ensure transactions go through quickly.

Ether’s July network upgrade, called the “London” upgrade, will include Enhancement Proposal (EIP) 1559, a controversial plan to automatically set the GAS price and then burn the fee rather than pay it to miners. In this way, the goal is to reduce the supply of Ether, increase market demand, and eliminate some network congestion.

While the new upgrade will reduce transaction fees by a certain percentage, the real shift will not happen until the full implementation of Ether 2.0.

Unlike current networks that rely on energy-intensive hardware for “mining,” the new proof-of-stake network will protect the network by allowing users to lock in their tokens in smart contracts. Ether 2.0 promises to significantly reduce congestion and allow thousands of transactions per second instead of the 15 or so of the current network, which will bring transaction costs down to more reasonable levels.

Until Ether 2.0 is realized, however, miners will still enjoy record fee income during the network’s transformation.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/miners-win-steadily-as-ether-gas-revenue-breaks-722-million-monthly-record/
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