Fees on the Ethereum network and bitcoin miners’ revenues have approached their lows

What’s new? Fees on the Ethereum network and bitcoin miner revenue are approaching lows. On June 22, for example, Ethereum prices fell to their lowest level since 2020. In turn, revenues from BTC mining are holding at minimum levels for the second month in a row.

What else is known? Last Saturday, the price of gas on the Ethereum mainnet fell just below 3 gwei, something not seen in the past four years, according to data from the analytics platform Dune. A year ago, the figure averaged 15-20 gwei. The current year peaked on March 5, with 83 gwei recorded then.

On March 13, Ethereum underwent the Dencun hardfork that introduced proto-danksharding and blobs, which reduced fees in Ethereum-based Layer 2 (L2) networks by 60-90%. After that, fees on the mainnet also began to steadily decline.

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The low cost of gas has caused the amount of burned ETH paid as fees to drop to a 12-month low, according to The Block. This deflationary mechanism was introduced to the mainnet along with The Merge hardfork on September 15, 2022.

However, ETH is now experiencing slight inflation due to the low volume of coins being burned, with an average seven-day supply growth of 0,56% per annum.

BTC miners’ revenue per 1 TH/s also fell to all-time lows in the last two months ($0,049). This occurred after the fourth halving event on the bitcoin network. The programmed event occurs every four years and halves the reward for mining blocks, slowing issuance and reaching the total supply limit of 21 million coins. On April 20, the reward was reduced to 3,125 coins.

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Another possible reason for the low profitability could be the low number of new bitcoin wallet registrations. The seven-day average is at its lowest level since 2018.

That said, many mining companies are performing well, and their stocks have outperformed bitcoin in terms of returns this year. CleanSpark, Bitfarms and Core Scientific are among them.

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In addition, earlier, Donald Trump met with representatives of US miners and promised to support the industry if re-elected as president.