Mining, in the world of Cryptocurrencies, refers to generating more portions of the respective digital currency. Miners can choose to dig in for Bitcoin, Ethereum, or any other cryptocurrency of their choice. Mining a Cryptocurrency is a way of increasing its supply in the market.
Miners are rewarded every time they successfully generate a portion of the digital currency. Rewards are in the form of the same digital token that they generated through their computation skills.
The opposite of mining is burning digital currencies, where the aim is to lower the circulation mainly for the purpose of increasing their price on the trading board.
Mining Revenue Rises Again
Bitcoin mining has generated revenues almost every time. The same applies to the network of Ethereum. However, it last generated revenue in the month of November last year, following which the industry started experiencing a freefall.
As of March 2022, the revenue has again risen for Ethereum miners to finally break the descending trend of the network. The revenue reportedly touched the monetary mark of $1.29 billion.
The trading price of ETH stands at $3,520.63. Ethereum price prediction estimates that the price will easily retain the mark of $3,500 if all the factors remain constant. This is a classic example of Ethereum holding future potential with stability in its trading price.
According to data made publicly available by The Block, the revenue of $1.29 billion is an increase of 7.2% as compared to what it generated in February 2022. Most of the revenue is a direct result of block subsidy, while around $100 million came from transaction fees.
The Ethereum network generating revenue from transaction fees is a direct result of EIP-1559, which came into effect in the London upgrade last year. As per the upgrade, the transaction fee was split to allow miners more tips while destroying the base fees.
Post the London upgrade, Ethereum began burning a huge portion of its circulation. The level for which stands at 2,063,565 ETH, worth around $7 billion. It will be right to state that the burning of Ethereum was in the direction of lowering the supply in the market and getting more returns for the traders.
Ethereum does hold a potential future ahead. The network has already tackled the issue of online hacking by making it difficult for notorious elements to crack into the ecosystem. This is the reason why banks have deployed the services of the Ethereum network to secure their payment and remittance systems.
Many smart contracts are based on the Ethereum network. Users are now beginning to realize that they can leverage this function without any alteration. Through the smart contract offering of Ethereum, users can access the feature of digitally recording agreements and transactions just like in a physical ledger.
Ethereum 2.0 has kept the hopes alive of all the members of the Ethereum community. Ethereum 2.0 comes loaded with added features to further improve the functionality of the network.