Bitcoin

April

The rise in transaction fees from Bitcoin Runes — a new protocol for issuing fungible tokens on the Bitcoin network — is offering a significant revenue boost for Bitcoin miners, according to Nazar Khan, the co-founder and COO of TeraWulf.
Khan told Cointelegraph in an exclusive:
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 “Runes significantly increased the transaction fees, so if anything, there was an increase in the hash price in the first 24-30 hours [after halving]. Since then, we’ve seen transaction fees come down, but compared to the average fees in 2023, they’re still pretty high.”
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As the rest of the Bitcoin block reward is fixed issuance, the transaction fees are the “wild card” for Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) miners, explained Khan.<iframe width="100%" height="315" src="https://www.youtube.com/embed/vJ02e-A1e-c" frameborder="0" allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen data-ct-non-breakable="true"></iframe>
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 Nazar Khan, interview with Cointelegraph. Source: <a href="https://youtu.be/vJ02e-A1e-c" target="_blank" rel="noopener nofollow">Cointelegraph</a>
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The boost in transaction fees represents a significant financial lifeline for miners after the <a href="https://cointelegraph.com/news/bitcoin-halving-2024">Bitcoin halving</a> reduced block rewards from 6.25 BTC to 3.125 BTC.
Total Bitcoin transaction fees stood at 105 Bitcoin&nbsp;on April 25, down from its peak of 1,257 on April 20 — the day of the Bitcoin halving — <a href="https://cryptoquant.com/asset/btc/chart/fees-and-revenue/fees-total?window=DAY&amp;sma=0&amp;ema=0&amp;priceScale=log&amp;metricScale=linear&amp;chartStyle=line" target="_blank" rel="noopener nofollow">according</a> to CryptoQuant data. Yet, transaction fees remained higher compared to most of 2023.
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 <img src="https://s3.cointelegraph.com/uploads/2024-04/2b2f0238-a8ff-4dc5-ae47-525569906e47.png" alt="" title="">
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 Bitcoin miner fees (Total). Source: CryptoQuant
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Related: <a href="https://cointelegraph.com/news/real-opportunity-bitcoin-runes-after-first-wave-investor-hype">‘Real opportunity’ for Bitcoin Runes will come after first wave of investor hype</a>
On average, transaction fees made up 30% of the Bitcoin block rewards since the halving, which is almost an additional Bitcoin for miners, on top of the existing block rewards, Khan said:
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 “If you think about the 30% [average transaction fee] where it’s been the last few days, that’s almost one BTC, on top of the 3.125 BTC that are being issued as block rewards. So it is very significant.”
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Transaction fees comprised an average of 10% of Bitcoin block rewards in 2023. TeraWulf assumed an average post-halving Bitcoin production cost of $37,000 per BTC, assuming a 10% average transaction fee.
But with higher average transaction fees, TeraWulf’s Bitcoin production cost will likely fall lower, contributing to its profitability, according to Khan:
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 “To the extent that transaction fees are higher than that, we will recognize a lower production cost. So even with 10% transaction fees, we will be very profitable, even post-halving.”
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TerraWulf is the eighth-largest Bitcoin mining firm, with an over $750 million market capitalization, <a href="https://companiesmarketcap.com/bitcoin-mining/largest-bitcoin-mining-companies-by-marketcap/" target="_blank" rel="noopener nofollow">according</a> to Companies Market Cap. The company is planning further expansions despite the halving of block rewards.
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-04/66e153e7-2cfe-4e33-b266-f9a82c5825ef.png" alt="" title="">
 <figcaption style="text-align: center;">
 Top Bitcoin mining firms. Source: Companiesmarketcap
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Related: <a href="https://cointelegraph.com/news/brc-20-tokens-bleed-bitcoin-halving-trader-runes">BRC-20 tokens bleed ahead of Bitcoin halving as trader focus shifts to Runes</a>

Runes are offering a significant lifeline for Bitcoin miners — TeraWulf COO

Cointelegraph

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