Bitcoin hits fourth halving, mining rewards drop while network fees skyrocket - why?
According to Bitcoin Explorer's BTC Scan, the Bitcoin blockchain has reached its fourth halving with the 840,000th block mined. As a result, the reward for mining a Bitcoin block was reduced from 6.25 BTC to 3.125 BTC. The 840,000th block was confirmed to have been mined by ViaBTC, the world's third-largest Bitcoin mining pool by hashrate.
The 10 blocks mined since the fourth Bitcoin halving on the morning of the 20th have rewarded miners with an average of 19.26 BTC. Starting with the 840,001th block, the rewards were 7.61 BTC, 10.11 BTC, 19.19 BTC, 27.13 BTC, 32.94 BTC, 26.28 BTC, 20.80 BTC, 15.3 BTC, 12.59 BTC, and 20.74 BTC, respectively.
Bitcoin halving is pre-programmed by the pseudonymous creator of Bitcoin, Satoshi Nakamoto, and occurs approximately every four years. Bitcoin's mining reward started at 50 BTC when it was first released and has decreased to 3.125 BTC through four halving cycles to date. While mining volume decreased on the first day of this halving, Bitcoin network fees increased by 68.51% to $11.47 million. While the halving itself reduced the mining reward to 3.125 BTC, it is believed to be due to the spike in Bitcoin transaction fees following the launch of the Runes protocol.
"The launch of Runes drove network fees to a record $80 million on Tuesday (local time)," said Lucas Outumuro, head of research at crypto market data analytics platform Into the Block. "That's about four times more than the previous peak in December 2017. Transaction fees on the Bitcoin network are averaging around $128 per transaction. And thanks to Runes, Bitcoin miners are making more money than they did before the halving. Mining rewards have been halved, but fee revenue has increased by 1,200%."
Runes is a protocol designed to create fungible tokens on the Bitcoin blockchain and was developed by Audience Protocol founder Casey Rodarmor as an alternative to the BRC-20 token standard. BTC Core developer Jimmy Song previously stated that "the spike in transaction fees on the Bitcoin network after the halving is due to the launch of the Loons protocol and auction system in the 840,000th block."
