Bitcoin Mining Revenue Plummets Amidst Transaction Fee and Block Reward Woes

Following the halving event, Bitcoin (BTC) miners have faced a decline in revenue. The average transaction fee on the network has dropped by 28% to around $24.99, and the daily miners' revenue has fallen by 5.1% to $48.17 million. Despite the downturn, the revenue remains 87% higher than a year ago, and the total Bitcoin supply held by miners is currently valued at $1.86 million BTC.

Bitcoin Miners' Revenue Plunges as Transaction Fees and Block Rewards Shrink

The Bitcoin (BTC) mining industry has faced a significant downturn in revenue since the recent halving event, which cut the block reward for miners by half. This decline has been exacerbated by a sharp drop in transaction fees on the network.

According to data from YCharts, the average transaction fee on the Bitcoin network has plummeted by 28% in the past 24 hours, hovering around $24.99 at the time of writing. This decline follows a surge in fees earlier this month, when the average transaction cost spiked from $19.76 to $128.45 between April 19 and 20. Notably, these fees have dropped significantly from a high of $5 per transaction a month ago and even dipped as low as $2.8 on April 6.

The dwindling transaction fees have taken a toll on miners' earnings. Data from YCharts shows that the daily revenue for Bitcoin miners fell by 5.1% on April 22, reaching $48.17 million. Despite this downturn, daily miner revenue remains up by an impressive 87% over the past year, with earnings reaching $25.7 million on April 23, 2023.

Data from Santiment reveals that the total Bitcoin supply held by miners currently stands at $1.86 million BTC. This decreased production has coincided with a decline in the asset's price volatility.

At the time of writing, Bitcoin has gained a modest 0.15% in the past 24 hours, trading at $66,175. The asset's market capitalization hovers around $1.3 trillion, with a daily trading volume of $24.7 billion.

The market intelligence platform Santiment also provides insights into the Bitcoin network value to transaction (NVT) ratio. This indicator measures the value of the network relative to its transaction volume. Over the past 24 hours, the NVT ratio has declined from 174 to 88, suggesting that Bitcoin may be slightly undervalued at its current price point. Traditionally, an NVT ratio above 100 would indicate that the asset is overvalued.

In conclusion, the Bitcoin mining industry is currently facing challenges due to declining transaction fees and block rewards. While miners' daily revenue remains up compared to last year, the recent downturn has taken its toll on earnings. The drop in production has also led to a decrease in the asset's price volatility, while the NVT ratio suggests that Bitcoin may be slightly undervalued at its current price.