ViaBTC: Bitcoin’s Ordinals and Runes Hold the Key to Resolving the Mining Subsidy Issue

Bitcoin mining pool ViaBTC believes that transaction fees from applications like Ordinals, Runes, and BRC-20s will be crucial for miners to sustain their operations as more halving events occur. The evolution of the Bitcoin network has led to a wider range of use cases and user base, significantly impacting miners’ fee income from on-chain transactions. Prior to the launch of the Ordinals protocol in January 2023, miners relied on peer-to-peer transaction fees alongside the block subsidy, which halves every 210,000 blocks and has a long-term impact on miners’ revenue. While mining revenue can also increase with the rise in Bitcoin’s price, further development at the application layer will enhance network activity and compensate miners more. ViaBTC experienced this firsthand when it mined the halving block at block 840,000 with a record-setting 37.6 BTC transaction fee. This significant reward came from memecoin and nonfungible token enthusiasts competing to inscribe “rare satoshis” and fungible tokens using the new Runes token standard. Bitcoin miners have made more from fees than Ethereum stakers and Uniswap liquidity providers in nine of the last 20 days since the halving. Satoshi Nakamoto, the pseudonymous creator of Bitcoin, predicted that transaction fees would eventually become the main source of miners’ compensation as the block subsidy halves. However, the popularity of Ordinals inscriptions, Runes, and BRC-20s has fluctuated, leading to some instability in miner revenue. ViaBTC has experienced three halving events since its establishment in 2016 and has a global hash rate sourced from miners in 118 countries.