Bitcoin Fees Plunge Following Record Daily Average of $128 on Halving Day

<img fetchpriority="high" decoding="async" class="alignnone wp-image-137058 size-full" src="https://technicalterrence.com/wp-content/uploads/2024/04/Bitcoin-Fees-Plunge-Following-Record-Daily-Average-of-128-on.jpg" alt="bitcoin Fees Plunge Following Record Daily Average of $128 on Halving Day” width=”958″ height=”640″ srcset=”https://technicalterrence.com/wp-content/uploads/2024/04/Bitcoin-Fees-Plunge-Following-Record-Daily-Average-of-128-on.jpg 958w, https://nftevening.com/wp-content/uploads/2024/04/image1-3-7-300×200.jpg 300w, https://nftevening.com/wp-content/uploads/2024/04/image1-3-7-768×513.jpg 768w, https://nftevening.com/wp-content/uploads/2024/04/image1-3-7-84×56.jpg 84w, https://nftevening.com/wp-content/uploads/2024/04/image1-3-7-150×100.jpg 150w, https://nftevening.com/wp-content/uploads/2024/04/image1-3-7-450×301.jpg 450w” sizes=”(max-width: 958px) 100vw, 958px”/>

On April 20, bitcoin saw an unprecedented rise in block fees, reaching a staggering average of $128. This increase coincided with bitcoin's fourth halving event, offsetting the block subsidy reduction miners faced. Just one day later, on April 21, average bitcoin fees plummeted sharply to $8-10 for medium priority transactions, marking a significant decline from the previous day's record high.

<img loading="lazy" decoding="async" class="alignnone wp-image-137059 size-full" src="https://technicalterrence.com/wp-content/uploads/2024/04/Bitcoin-Fees-Plunge-Following-Record-Daily-Average-of-128-on.png" alt="Average daily transaction fee in bitcoin over the last 5 years.” width=”1251″ height=”452″ srcset=”https://technicalterrence.com/wp-content/uploads/2024/04/Bitcoin-Fees-Plunge-Following-Record-Daily-Average-of-128-on.png 1251w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-300×108.png 300w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-1024×370.png 1024w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-768×277.png 768w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-155×56.png 155w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-150×54.png 150w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-450×163.png 450w, https://nftevening.com/wp-content/uploads/2024/04/image4-1-1200×434.png 1200w” sizes=”(max-width: 1251px) 100vw, 1251px”/>Average daily transaction fee in bitcoin over the last 5 years. Source: Y Charts

Record fee revenue

On the day of the halving, bitcoin raised $78.3 million in total fees, outperforming ethereum by more than 24 times, crypto Fees reported. Notably, a single block at a height of 840,000 rewarded a miner with a staggering 37.7 bitcoin, equivalent to $2.4 million, making it a historic moment for the network.

Block 840,000 witnessed notable demand, driven by memecoin and non-fungible token (nft) enthusiasts vying for rare satoshis using the Runes protocol. This resulted in 3,050 transactions being included in the block, with users paying an average of almost $800 each.

Highest fees for blockchains and decentralized finance projects on April 20. Source: crypto Fees

The high block fees persisted until around block 840,200 before gradually decreasing to around 1-2 bitcoin, as seen in mempool.space.

Impact of halving on miners

Initially protected by significant block fee payments, miners were somewhat insulated from the halving of the block subsidy from 6.25 bitcoin to 3.125 bitcoin. However, with the average block fee now below 3,125 bitcoin, miners are feeling the impact more acutely.

Source: Total fees for block 840,266 amounted to 1.64 btc. With the new block subsidy of 3,125, the total rewards amounted to 4.76 btc. Source: mempool.space

For six consecutive days through April 20, bitcoin surpassed ethereum in fee income, with a 7-day average of $17.8 million, highlighting its dominance in this regard.

Despite the events, the bitcoin halving did not cause any major fluctuations in the price of the cryptocurrency. bitcoin's value has remained relatively stable, witnessing a modest 1.5% increase since the halving to reach $64,840, according to CoinGecko.

Final thoughts

In summary, bitcoin network fee dynamics during the halving showed both the resilience and volatility inherent to its decentralization. From all-time highs to rapid declines, the bitcoin fee landscape continues to evolve, reflecting the intricate interplay between network demand, miner incentives, and market forces.