Miners have a bumper harvest in the new year, how about digging Ethereum? Or Bitcoin?
The price of bitcoin, the world's largest cryptocurrency by market capitalization, has fallen and stabilized since it topped $40,000 at the start of the year, breaking a record. Although there is no hope of breaking new highs, the income of Bitcoin miners is still eye-catching!
According to on-chain data from blockchain analytics firm Coin Metrics, Bitcoin miners earned an estimated $1.1 billion in January this year, up 62% from December!
Measured in TH/S units, pie miners’ unit revenue has fluctuated between $0.20 and $0.27 for most of the month after peaking at $0.32 earlier this month, according to Luxor Technologies.
Fees in USD terms fluctuated wildly in January, with the average transaction cost ranging between $5 and $16 throughout January. BTC miners earned $116 million in network fees in January, accounting for more than 10 percent of their total revenue, a slight increase from 9.8 percent in December. Additionally, miners’ fee income reached its highest level since January 2018, according to Coin Metrics data.
Before the halving of the Bitcoin network rewards in May last year, the proportion of fee rewards in the total revenue of miners has been on the rise. Bitcoin’s block reward is halved every four years, and the increase in fee income allows miners to better maintain network security.
Also grinning from ear to ear are the miners of the world's second largest cryptocurrency, Ethereum. Due to the soaring network activity, fees and currency prices, the revenue of Ethereum miners reached a staggering $830 million in January!
On-chain data shows that in January 2018 Ethereum’s network fees accounted for only 9% of miners’ monthly income. In January of this year, nearly 40 percent of revenue came from network fees, totaling more than $504 million.
Given the high transaction costs on the Ethereum network, it is no surprise that fee revenues have grown as a percentage of total miner revenue. According to Blockchair, the average USD-denominated transaction fee hit an all-time high on Jan. 11, surpassing $19. When DeFi was at its hottest, the average transaction fee was $10.33 on September 1 last year.
It is worth noting that the above earnings estimates have a premise, that is, it is assumed that miners will sell their bitcoins and exchange them for legal currency (US dollars). Generally speaking, miners will not sell their chips so easily, so the valuation is only a model based on the legal currency standard. But in any case, it is a fact that the income of miners of the two major currencies has increased. Compared with the roller coaster market in the currency circle, the miners still conform to their low-key image of "making a fortune silently".
Seeing the soaring income of miners of these two major currencies, I believe many people will have a question?
Is it better to mine Bitcoin or Ethereum?
Comparing the mining of these two currencies requires consideration of many factors. In addition to factors such as mining machine model, power and operating costs, and payback cycle, the future development prospects and appreciation space of the two public chains also need to be considered. Since mining has a certain threshold, there are also requirements for capital volume and industry experience. Therefore, different investors may have different answers. However, almost all of the top ten listed mining companies in the world choose Bitcoin mining machines. In addition, with the 2.0 upgrade approaching, many people are also worried about whether Ethereum mining is already a sunset industry.
Juan Technology believes that, as the most well-known cryptocurrency at present, Bitcoin mining has indeed achieved the ultimate in connecting traditional finance and encryption industries, while Ethereum still has a lot of room for imagination. From $87 in March last year to $1,500 at this stage, Ethereum has completed a nearly 20-fold increase. In terms of rate of return, Ethereum mining has easily surpassed Bitcoin mining. In addition, the blowout of the number of applications on Ethereum is in stark contrast to the relatively lonely scene of Bitcoin, which will inevitably affect the future appreciation space of these two public chains.
So while Ethereum mining, like everything else, will eventually die, until the arrival of Ethereum 2.0, which is visible to the naked eye, the rewards of ETH mining should exceed BTC. What do you think?
