In September, it was definitely more financially attractive to be an Ethereum miner than a Bitcoin miner. Transaction fees collected by Ethereum miners were six times higher than those of Bitcoin over the period.
In August and September, one can without hesitation speak of overheating on the Ethereum blockchain. Due to frenetic activity in the decentralized finance sector, the saturation point was largely reached.
This situation has at least one advantage for the miners: revenues from booming transaction fees. Glassnode is also taking stock for the month of September. Ethereum’s fees peaked at $166 million for the period.
Ethereum’s fees surpass those of Bitcoin since June.
In comparison, these costs were ‘only’ $26 million for Bitcoin. So for the miners, it’s a good deal. The trend is not new, however. September is the confirmation of the previous months.
Indeed, as CoinDesk points out, Ethereum’s fees have supplanted those of Bitcoin since June. It was the first time then. The reason is always the same: DeFi. The protocols are essentially based on the Ethereum blockchain.
In addition, it is from June that the activity of these crypto services took off, to approach today the 11 billion dollars of committed funds. Especially in early summer, the very popular Compound launched its governance token. Many DeFi protocols followed suit, including Uniswap with its UNI token.
Inflation generated by DeFi and governance tokens
Decentralized finance has therefore widened the gap between Ethereum and Bitcoin on this painful issue of costs. In June, the difference between the two blockchains was only $10 million.
By August, it had already peaked at more than 70 million. But it really peaked in September, when Ethereum and Bitcoin miners reached $166 million and $26 million respectively.
At the end of September, however, the cost of processing transactions on the Ethereum blockchain was back to a bearable level, by comparison, at around $2. Earlier in the month, that figure had risen to $11.
However, a further increase in costs cannot be ruled out. The DeFi players are aware of this. So, these protocols are now rushing to switch to a Layer 2 architecture. And that includes the most popular DeFi platforms, including Uniswap, Aave and Synthetix. The saving grace of Ethereum gas fees should still be the launch of Ethereum 2.0 however which should strongly reduce the cost for transactions on the Ethereum platform.