Bitcoin Ordinals, Runes Key to Solve Mining Subsidy Problem: ViaBTC

Bitcoin transaction fees from apps like Ordinals, Runes, and BRC-20s will be key to keeping miners afloat when additional halving events occur.

“[The Bitcoin network’s] Evolutionary expansion has led to usability issues and a growing user base. [which] Miner fees from on-chain transactions have had a significant impact on revenue,” ViaBTC told Cointelegraph in a recent interview.

Prior to the launch of the Ordinals protocol in January 2023, miners relied on peer-to-peer transaction fees to accompany the block grant – which halved every 210,000 blocks and had an “indisputable” impact on miners' earnings in the long term, ViaBTC said. .

Mining revenue may increase with an increase in the price of Bitcoin (BTC), but further development at the application layer will increase network activity, expand its utility and thus handsomely compensate miners, ViaBTC explained.

ViaBTC experienced this first-hand on April 20 when it released the highly sought-after halving block at block 840,000, with a record transaction fee of 37.6 BTC – $2.4 million at the time.

The reward, totaling 40.7 BTC in the new 3.125 BTC block grant, came from memecoin and nonfungible token enthusiasts competing to carve out “rare satoshis” and fungible tokens in the new Runes token standard.

ViaBTC told Cointelegraph that transaction fees will eventually break the barriers of 30, 40, 50 BTC, but they do not expect such a large reward users will be – let alone halved.

While Bitcoin miners spent an eye-watering $78.3 million in the half-day, according to Crypto Fees, they got paid more than Ethereum stakers and Uniswap liquidity providers in the last 20 days in a half-day.

Bitcoin's anonymous creator Satoshi Nakamoto has predicted that transaction fees will eventually become the main source of compensation for miners as block subsidies decline, according to ViaBTC.

Related: Bitcoin Post-Halving Price Consolidation Could Last 2 Months – Bitfinex

“If these transactions gain widespread use and make significant technological advances in the future, they may gain greater attention and recognition,” ViaBTC added.

However, plaintexts, Runes, and BRC-20s have seen several changes in popularity levels after each protocol was released, leading to some instability in mining revenue.

ViaBTC has experienced three stripping events since its launch in 2016, and block 840,000 is the 37,534th block mined in its 2,900-day existence.

The mining pool's hash rate is derived from miners in 118 countries.

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