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Ethereum Miners earn colossal fees of $166 million in the month of September

Photo of: Sangeetha Golchha
by Sangeetha Golchha

The month of September this year has been great for the Miners on the Ethereum Network. According to on-chain analytics organization Glassnode, miners on the Ethereum network have recorded their highest-ever earnings. The major reason behind such fruitful earnings has been the ever-growing space of DeFi in the crypto industry beginning this year. Miners on any network are those individuals or entities who make use of computing rigs to maintain and mine blocks on PoW cryptocurrencies like Bitcoin and Ethereum for rewards. These rewards are nothing but the tokens they are mining. 

The Ethereum network in particular has attracted increased traffic and individual smart contract activity that has converted into high rewards for miners. The participants bid higher amounts so that their transactions could be executed faster. Glassnode mentioned on its Twitter status that the Ethereum miners have made a total of $166 million from transaction fees in September which is its new all-time high. The new figure is a staggering 47% increase from its previous earning in the month of August. 

Source: Twitter

Compared to this figure, the Bitcoin miners lag behind and have made only $26 million from fees in the last month. This is a huge difference in the mining fees despite Bitcoin being the oldest and the most popular of the lot. Some miners also believe that a major proportion of the growth came because of accelerated trading activity in the low-cap DeFi projects and non-fungible tokens like Meme and Shroom which raised huge amounts of retail capital.

Because of the DeFi boom, transaction fees and miner earnings were really high,” Thomas Heller, chief operating officer of mining firm Hashr8, said.

As compared to centralized exchanges like Binance, all DEX transactions are carried out on-chain on the Ethereum Blockchain compared to the in-house trade matching of Centralized exchanges. This implies that all the miners in the system approve and conduct every single DEX trade and earn money on each trade they execute. 

Earlier in March and April this year, the Glassnode data showed that Ethereum miners were making anywhere in the range of $4 million in fees. The miner rewards and fee began to pick up pace in the month of June and July when the DeFi industry in totality began to explode and gained steam because of the launch of Compound, a new lending protocol. These previous two months of bombastic growth patterns enabled them to pocket $22 million and $32 million in the months of June and July respectively. 

The real momentum was recorded from July onwards when there was a sudden explosion in the fee leaving Bitcoin far behind. 

The future perspective for miners looks bright because more trading, transactions, and smart contract interactions are made on the Ethereum Network. Many industry followers believe that at some point in time or the other the bubble of DeFi will burst, but the miners would only hope that the time is not soon enough so that they can make the best out of it till it survives.