Is ETH mining still profitable? Miners fight EIP-1559

Updates vs. miners

On August 5, we witnessed a major London hard fork, which also brought with it EIP 1559. This protocol works as a mechanism for burning transaction fees for ETH. It was initially claimed that this protocol would adversely affect the protagonists of Ethereum mining. Surprisingly, however, these conjectures are not yet being fulfilled.

Miner gains are falling

After hard fork we can for the first time realistically assess how the miners are doing. Over the last 10 days, total profits have decreased from 21,000 ETH to 17,500 ETH. We can clearly attribute the greatest impact on the decline in revenues to the process of burning fees. Revenues from fees alone fell by as much as 14%. Currently, the decline is at the level of 22% and continues to decline.

So what’s the catch? Despite the decline in income, the miners do not give up. They are even increasing their numbers. Validators are increasing and the number of their addresses has reached a 3-month maximum. This is definitely a good sign for the ETH network. The influx of new entrants increases the quality of the network, as charges are no longer the main source of revenue.

 

Current situation

It was expected that after the launch of the hard fork, miners would sell in bulk. However, the opposite is true. The ETH reserves themselves have increased since the launch of EIP-1559 about 16,000 ETH. This is indeed a positive sign for the ETH spot price itself.