Bitcoin (BTC) miners are seeing a significant boost in revenue due to the uptick in transaction fees originating via Bitcoin Runes, a fresh protocol for issuing fungible tokens on the Bitcoin network, as indicated by TeraWulf co-founder and CEO, Nazar Khan. Heightened Transaction Fees Khan stressed the impact on transaction fees, highlighting that Runes notably raised transaction fees, leading to a hike in hash price within the initial 24-30 hours post-halving. Since then, there has been a noticeable decline in transaction fees, but they still stand considerably higher compared to 2023 averages. As Khan elucidated, with the remainder of the Bitcoin block reward set as a fixed issuance, transaction fees become the variable factor for Bitcoin miners. This surge in transaction fees offers vital financial support for miners post-Bitcoin halving , which reduced block rewards to 3.125 BTC. Even though total BTC transaction fees dropped to 105 BTC on April 25, they remained notably elevated compared to most of 2023, as per CryptoQuant data. Estimating Production Costs On average, post-halving transaction fees constituted around 30% of Bitcoin block rewards, providing miners with nearly an additional Bitcoin atop existing block rewards, Khan disclosed. In contrast, transaction fees accounted for only 10% of Bitcoin block rewards in 2023. TeraWulf estimated a post-halving Bitcoin production cost of $37,000 per BTC, assuming a 10% average transaction fee. However, with the current higher average transaction fees, TeraWulf anticipates a further reduction in Bitcoin production cost, thereby bolstering profitability, Khan suggested. Despite the halving of block rewards, TeraWulf remains poised for expansion as the eighth-largest Bitcoin mining firm, with a market capitalization surpassing $750 million, according to Companies Market Cap.
