With a record daily average of $128 on the day of the halving, bitcoin fees plummeted.
The Bitcoin halving, which occurs approximately every four years, has a significant impact on the economics of the Bitcoin blockchain. In the most recent halving event on April 20, 2024, the block reward decreased from 6.25 Bitcoin per block to 3.125 Bitcoin per block. This reduction in block rewards directly affects miners’ income when creating new Bitcoin.
Interestingly, the halving also triggered a surge in transaction fees. The launch of a new protocol called Runes led to a flurry of transactions as speculators rushed to mint digital tokens on the blockchain. Notably, the halving block (block 840,000) witnessed an unprecedented 37.6 BTC fee (worth over $2.4 million) attached to it. Even after the halving, fees remained elevated due to intense competition among users vying to mint these new tokens.
In summary, while the halving initially offset the reduced block subsidy, the subsequent surge in transaction fees has reshaped the landscape for Bitcoin miners.
