Bitcoin miners have earned above $50 billion in block rewards and fees since the cryptocurrency’s inception in 2010, according to on-chain analytics firm Glassnode. The figures are based on two main metrics: thermocap and transaction fees, media reports said.
One of the metrics used to determine Bitcoin miners’ earnings is the is calculated by adding together the rewards given for each block mined (issuance), multiplied by the current market price of Bitcoin (spot price), and the fees earned from transactions made on the Bitcoin network. This is called the “thermocap.”
The other metric is the total cost of mining input, known as the “difficulty production price. The total earnings of Bitcoin miners have exceeded their estimated costs by nearly 40%, with a total income of $50.2 billion compared to estimated costs of $36.6 billion.
The data also counters concerns that a significant drop in the BTC or USD price may cause a widespread shutdown of Bitcoin mining operations, as network fundamentals continue to support growth.
The increase in newly created and unspent transaction outputs (UTXOs) is making Bitcoin on-chain transactions less attractive, leading to higher transaction fees. According to Glassnode, UTXOs have reached their peak levels since May, 2015, causing fees to increase. Blockchain.com reports that the 1-day (MA) moving average transaction charge rate was $6.91 on May 2, the highest since 2021 (July).
Despite this, the Bitcoin network’s hash rate and difficulty continue to hit new all-time highs in 2023. According to BTC.com’s latest projections, the upcoming difficulty adjustment for Bitcoin is expected to be negative, which would be the first such occurrence since mid-February 2023.
The long-term profitability of Bitcoin miners indicates that the mining industry is here to stay, even as the cryptocurrency market experiences ups and downs.
