ETH miners’ revenues increased in September, according to data from Glassnode, a source of analysis on the chain. Although the price of ether has not increased significantly over this time, miners on the Ethereum network have seen an increase in revenue due to higher taxes.

Miners received 450,089 commissions from ETH ($ 168.7 million), which is 39% more than last month, as miners earned about $ 113 million in commissions.

During the same period, Bitcoin miners’ fee income not only decreased in relation to this, but actually decreased. BTC miners earned $ 26 million in September, down 50% from $ 39 million in August. According to the F2Pool Mining Group for Mining, mining Ether is three times more profitable than mining Bitcoin.

Bitcoin vs Ether – all miners make money. Source: glass node
The significant increase in Ethereum miners’ revenues is due to activity in the decentralized financial sector, which peaked in September and increased transaction fees several times.

DeFi is great for farmers and miners

DeFi not only demonstrated a convincing use case for Ethereum, but also created new demand for Ether as a gas for transactions and smart contracts. All of these factors pushed Ethereum forward in 2020 so that it could surpass Bitcoin significantly.

Furthermore, a significant amount of BTC entered the Ethereum blockchain in the form of WBTC and RenBTC, which has increased activity on Ethereum. To date, wrapped BTC alone has coded for around $ 1 billion in BTC.

Bitcoin and Ethereum indicators since the beginning of the year. Source: data on digital assets.
As the revenue from Ether miners grows, new members join the network to reap the benefits. The network’s hash rate has also grown steadily and reached another full-time high on October 7, which is another big positive for Ether as it shows that more participants are investing in the network.

Recent data also shows that new users are flocking to Ethereum. MetaMask, the popular Ethereum browser wallet widely used on DeFi, reached as many as 1 million monthly users this month as the number of ETH addresses continues to grow, but can Ethereum be able to handle the extra network load?

DeFi will either create or break Ethereum

DeFi is building support for Ethereum and has helped bring many miners back into the network, but it is also worth noting that the fees have reached unacceptable levels due to congestion in the network.

As users compete to process their transactions, higher fees should be paid. On September 2, the average transaction cost on Ethereum averaged $ 15, according to Blockchair data.

While this is beneficial for miners in the short term, it may discourage regular users from using DeFi in general, as smart contracts become too expensive to use. In fact, this problem may be one of the main reasons for the sharp correction observed in the prices of DeFi tokens in the last month.

The total cost is related to DeFi. Source: data on digital assets.
While level two solutions are gaining traction, most do not use them. Other permanent solutions such as the upcoming Ethereum 2.0. It also seems far from clear, which could lead to competitors like Binance’s smart chain or even bypassing Ethereum altogether.

There are also analysts who believe that the Defi “madness” may end when popularity declines and regulatory action is imminent.

However, it is important that Ethereum quickly solves the scalability issue if it wants to interact with DeFi and the potential growth of new trends such as non-native tokens.

Source: CoinTelegraph