The London fork on the Ethereum blockchain went live on August 5. Along with it came the Ethereum Enhancement Protocol (EIP) 1559, which initiated a fee-burning mechanism for every transaction. According to many, this EIP was expected to negatively impact miners, with some of these fears possibly coming true as well. However, even with these losses, the miners have moved surprisingly against expectations.
This is the situation for ETH miners right now.
Ethereum miners’ fees burn
While the gas tariff burning mechanism was predicted to make things difficult for miners, for the first time, we can assess its real impact. This can be determined from observations made by deriving data from the miners’ total income.
In the last 10 days, total revenue has dropped from 21k ETH to 17.5k ETH. Although gas tariffs were not the main source of income, their elimination has mainly contributed to this drop. Fee and commission income fell 14% from 36% to 22% in less than a week and is still falling right now.
However, what is surprising is that, despite their loss of income, the miners are not discouraged. The network has seen an increase in the number of participants seeking to be validators. The number of addresses with ETH> = 32, which are mostly validation addresses, hit a 3-month high yesterday.
This is a good sign for Ethereum. It not only strengthens the network, but also makes it possible to make a profit, since the fee is no longer a source of income. Their effects are visible in multiple indicators.
How are the miners doing?
Pretty good. The reason behind this is the fact that despite the tariff burning mechanism, the miners have not been selling. They were expected to sell their shares to cover the loss of commissions, but the opposite has been the case.
Ethereum mining reserves have increased by almost 16,000 ETH since the implementation of EIP-1559. Selling has not been in the cards, which is good not only for them, but also for the alternative price action.
This positive momentum is also reflected in the hash rate that has successfully recovered from the bear market. At the time of this report, the hash rate was close to setting a new all-time high around 611T.
Not only this, but the emission rate, which witnessed a significant drop in July, also returned to March levels.
All things considered, Ethereum is in a positive state of health from a mining perspective.
This is a machine translation of our English version.
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