Bitcoin

Impact

April

<h2 id="key-points">Key Points</h2>
<ul>
 <li>Bitcoin Runes protocol has significantly increased transaction fees, providing a revenue boost for Bitcoin miners.</li>
 <li>TeraWulf, a leading Bitcoin mining firm, is likely to see increased profitability due to higher average transaction fees.</li>
</ul>
<p>A new protocol for issuing fungible tokens on the <a href="https://crypto.ro/en/cryptocurrencies/bitcoin/" rel="noopener noreferrer nofollow">Bitcoin</a> network, known as Bitcoin Runes, has led to a surge in transaction fees. This trend is providing a substantial revenue increase for Bitcoin miners, as stated by Nazar Khan, the CEO of TeraWulf.</p>
<h2 id="increased-transaction-fees">Increased Transaction Fees</h2>
<p>Khan revealed that the rise in transaction fees had led to an initial increase in the hash price. Although these fees have since decreased, they remain considerably higher than the average fees in 2023.</p>
<p>Transaction fees are a variable factor for Bitcoin miners as the Bitcoin block reward is fixed. This increase in fees is a significant financial source for miners, especially after the halving of Bitcoin block rewards from 6.25 BTC to 3.125 BTC.</p>
<h2 id="impact-on-miners">Impact on Miners</h2>
<p>On April 25, total Bitcoin transaction fees were at 105 Bitcoin, down from a peak of 1,257 on April 20, the day of the Bitcoin halving. However, these fees are still higher than most of 2023.</p>
<p>Since the halving, transaction fees have constituted about 30% of the Bitcoin block rewards. This percentage is almost an additional Bitcoin for miners, on top of the existing block rewards.</p>
<p>In 2023, transaction fees comprised an average of 10% of Bitcoin block rewards. TeraWulf estimated an average post-halving Bitcoin production cost of $37,000 per BTC, assuming a 10% average transaction fee.</p>
<p>With the current higher average transaction fees, TeraWulf’s Bitcoin production cost is expected to decrease, contributing to its profitability. According to Khan, even with 10% transaction fees, the company will remain highly profitable post-halving.</p>
<p>TeraWulf, with a market capitalization of over $750 million, is the eighth-largest Bitcoin mining firm. Despite the halving of block rewards, the company is planning further expansions.</p>

Bitcoin Miners Thriving on Runes: Insights from TeraWulf’s CEO

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