- Ethereum mining saw revenue of nearly $2 billion in November.
- This is the seventh consecutive month that revenue from mining for Ethereum has been higher than the returns from Bitcoin mining.
- One of the reasons for the boost in Ethereum mining fees is the jump in demand for validating transactions as the hype around NFTs, the metaverse and DeFi continues to build.
High gas fees may not be a good thing for users trying to push transactions through on the Ethereum blockchain, but miners are more than happy raking in the big bucks. According to research by The Block, Ethereum mining revenue clocked in at $1.99 billion in November.
Not only is this an 11.8% increase over October, but it’s also the seventh consecutive month that revenue from Ethereum mining has been higher than revenue from Bitcoin mining this year.
Ethereum’s high gas fees as are a boon for miners
Gas fees are basically the transaction fees paid to miners for validating a transaction. Simply put, miners are incentivised to keep Ethereum gas fees high. And, they have control.
The threshold that miners’ can charge is determined by the simple economics of demand and supply. The congested a network is, the higher will be the gas fees. For a miner, gas fees going to the moon is a good thing. For a developer or a trader, a transaction can get delayed, or just simply rejected, if it doesn’t meet the miner’s threshold.
And, until Ethereum 2.0 kicks in to solve the problem, miners are raking in the big bucks.
Ethereum transactions are raging on the NFT, metaverse and DeFi hype
There may be a lot of contenders out there, eyeing Ethereum’s throne as king of the smart contract universe, but the blockchain platform continues to remain the biggest bull out there with a market value of $504 billion, according to the data collected by CoinMarketCap.
Moreover, the hype around non-fungible tokens (NFTs), the metaverse and decentralised finance (DeFi) led the cryptocurrency to hit an all-time-high of $4,859 on November 10. Platforms like the NFT marketplace OpenSea, the metaverse called Decentraland, play-to-earn (P2E) game Townstar and others are built on the Ethereum blockchain.
Top five blockchain platforms in the DeFi space:
|Cryptocurrency||Total value locked (TVL) in DeFi|
|Ethereum (ETH)||$168.91 billion|
|Binance Smart Chain (BSC)||$16.53 billion|
|Terra (LUNA)||$13.17 billion|
|Avalanche (AVAX)||$12.28 billion|
|Solana (SOL)||$12.05 billion|
Source: DeFi Llama as of December 8
DeFiPrime pegs that of the 236 DeFi applications in the world right now, 213 are on the Ethereum blockchain. There’s a total of $255.8 billion of total value locked across all DeFi protocols and Ethereum accounts for more than half of that at $168.91 billion.
The growth of applications being built on the Ethereum blockchain has caused an increase in demand for Ethereum transactions. It may be expensive, but there are enough people out there willing to pay the high gas fees in order to get their hands on NFTs worth millions and real estate within the metaverse.