Has Ethereum miners’ income increased or decreased one week after EIP-1559 went online?

It has been a week since EIP-1559 was activated. Frankly speaking, this Ethereum improvement proposal was discussed for more than two years before it was finally launched. I believe many people know that EIP-1559 will have an impact on miners’ income after it is deployed on the Ethereum blockchain. So how much impact has it had so far? Let’s take a look.

In fact, EIP-1559 seems to effectively accomplish two things:
1. Destroy Ether (ETH)
2. Limiting the block size to an ideal target After the Ethereum Improvement Proposal is deployed, it may not be very helpful for users to predict transaction fees in a few minutes or hours, but it can eliminate the uncertainty of transaction pricing in the current network transaction boom. The figure below shows the network activity on the Ethereum 2.0 beacon chain in the past week, with a network participation rate of 97.1-99.4% and a total deposit of ETH of 6,629.090 ETH, worth approximately US$20.7 billion.

New field: Ethereum miners' income remains stable. The Ethereum network used to adopt the first-price auction model, that is, each transaction is equipped with a bid, and the miner receives as much as the user gives. When the network is congested, in order to improve "efficiency", there will always be users who increase transaction fees to increase processing speed as quickly as possible, which actually leads to unfair competition.
The first-price auction mechanism is actually more friendly to miners, but for the majority of users and ecosystem developers on the Ethereum network, it has the problem of increasing transaction costs.

Last Thursday (August 5), EIP 1559 was activated along with four other EIPs (EIP-3198, EIP-3529, EIP-3541, and EIP-3554) bundled in the Ethereum "London" upgrade, after which most of the transaction fees previously awarded to miners will be burned and removed from circulation. So far, about 26,756.06 ETH have been burned, accounting for 33% of the increase in new token supply. However, the reduction in transaction fee revenue does not seem to have significantly affected Ethereum's total miner revenue. According to Coin Metrics data, after the activation of EIP 1559, the average daily miner revenue in US dollars increased by 7.1% and remained at a two-month high. There may be two reasons for this phenomenon:
1. ETH price rises. According to Anand Gomes, co-founder of Paradigm, the “London” upgrade of Ethereum has pushed up ETH prices and attracted some institutional investors. Although miners’ native ETH revenue from transactions has decreased, this “loss” has actually been made up because of the rise in ETH prices;
2. Miners can still get rewards in blocks through the so-called "priority fee". Since the "London" upgrade, Ethereum users have paid 7,141 ETH "priority fee" in the hope that their transactions will be prioritized by miners.

In addition, as Ethereum prices rise and non-fungible token (NFT) trading activity surges, it also offsets the potential loss of miner revenue caused by EIP-1559.
NFT trading activity on Ethereum surges In addition to price activity, the number of on-chain transactions to transfer NFTs has increased by 75% over the past 7 days, a factor that has also led to an increase in miner revenue. In recent days, the most traded NFTs are the CovidPunks series, which were released on the same day as Ethereum's "London" upgrade and sold out within minutes.
In addition, the total sales of CovidPunks have exceeded $200,000 in the past 7 days. Some users reported that their transactions failed due to insufficient transaction fees. When these NFTs started trading, the network transaction fee was less than 100 gwei (gwei is one billionth of ETH), but an hour later, the Ethereum gas fee soared to 400 gwei.
In addition, under EIP 1559, miners can still earn rewards through a feature called "priority fees," which allows users to have their transactions processed earlier as long as they are willing to pay a priority fee. Since the activation of the "London" upgrade, Ethereum users have paid a total of 7,141 ETH, worth about $22.4 million at the time of writing.
Since miners still receive rewards from a portion of transaction fees on Ethereum, a surge in on-chain activity due to NFT airdrops or popular decentralized finance (DeFi) applications, as well as traders’ willingness to increase “priority fees”, has led to an increase in miners’ total revenue.
Most transactions are not formatted for EIP 1559 As previously reported, the vast majority of Ethereum transactions are not formatted for EIP-1559, meaning that users have not specified a minimum base fee or priority fee. In these cases, the legacy transaction fees on Ethereum are automatically split into one part to cover the base fee cost (which will eventually be burned) and the other part to pay the priority fee reward to miners.
For users, transactions in the EIP-1559 format are usually cheaper than traditional Ethereum transactions, so there will definitely be more and more applications and service providers that accept the Ethereum Improvement Proposal. It may only be a matter of time before the entire network accepts EIP-1559. Users and institutions that have not yet adopted it may just want to see if Ethereum has enough stability and effectiveness after deploying EIP-1559. (Golden Finance)