Ethereum miners’ income hits a record high, and the proportion of GAS fee income continues to soar

• Data from Glassnode shows that the Ethereum network is now more active and sustainable than it was at the beginning of 2018.

• Miners receive record profit shares from network fees.

• Transaction complexity, measured by total GAS consumption, is also rising.

Ethereum has rallied more than 180% since its March 2020 lows, but on-chain data suggests the world’s second-most popular digital asset by market cap could have further to climb in value.
Measurements compiled by blockchain data analysis company Glassnode show that many key Ethereum metrics are now even higher than their highs at the end of 2017, including the amount of gas used in transactions and the revenue of miners currently supporting the Ethereum blockchain's proof-of-work.

Data shows that there are significantly different market fundamentals in 2020 than when Ethereum hit an all-time high of more than $1,400 two years ago, providing some basis for investors who may gain additional gains.

As of now, there are reports that fees on the Ethereum network are at their highest levels ever (and may be pulling Bitcoin fees higher with them). However, Glassnode data shows that the difficulty and hash rate of the proof-of-work mining activity that secures the Ethereum blockchain has fallen by nearly 25% since its peak in the summer of 2018.

A lower hash rate means ETH miners can process more transactions with the same hardware. While the reward for minting new Ethereum as a reward to move the blockchain forward has remained stable since February 2019, overall, the network's overall hash rate is low, meaning that more of the gas that Ethereum transactions need to pay will flow to each miner.

This has led to an interesting phenomenon that Ethereum miners have recently begun to discover: more than 16% (sometimes more than 19%) of all revenue is generated from fees paid for broadcasting transactions to the network. In contrast, in early January 2018, when the ETH price peaked, miners never earned more than 15% from fees.

This is due to an increase in actual activity on the Ethereum blockchain, resulting in miners, the infrastructure providers of the Ethereum network, earning more and more money, especially compared to previous periods of activity and price optimism.

Ethereum’s total GAS usage has significantly surpassed levels seen at its all-time high. Total GAS usage has nearly doubled compared to January 2018, as Ethereum transactions have moved beyond simple sending and receiving between individual wallets or exchanges to more complex (and expensive) operations performed by smart contracts used in DeFi activities.

The market shifted from speculation that decentralized applications were “coming soon” to functional applications for lending mining, DEX trading, and yield farming, which was reflected in the significant increase in GAS usage.

Will prices continue to climb?

A lot will change about the inner workings of Ethereum with the launch of Eth2, the long-awaited (and many times delayed) network upgrade. This includes the number of transactions that can be processed per second, and the nature of how blocks are generated in the network. Until then, Ethereum holders seem to remain optimistic.

The best time to save on Ethereum GAS mining fees

“To save on gas fees, the best time to transfer is early in the morning on weekends in Asia time and the worst time is around 8 pm [UTC 12:00] every Thursday,” according to the research by Marchioro, chief scientist at blockchain startup DEXTF .

Marchioro noted that Asia has more trading volume during the day, which means that if they wait in the early morning hours in Asia, they can save on GAS fees . The author specifically mentioned Singapore as "one of the most vibrant places for DeFi startup blockchain companies."

Therefore, on average, the best time to save on GAS fees is to submit transfers or transactions between 2 AM Singapore time (18:00 UTC) and 8 AM GMT (12 AM UTC). In addition, "the worst time of the week for GAS fees is Thursday at noon UTC or 8 PM Singapore."

The report noted that the average surplus was positive on weekdays, while the GAS fee surplus was negative for most of the weekend, with positive peaks at 14:00 and 15:00 on two days. "This means that in order to save GAS fees on average , it is better to wait until the weekend to submit transactions to the Ethereum blockchain."

“With the emergence of more and more sleepless robots and the rapid development of artificial intelligence, we expect the hourly or weekly periodicity gaps of all blockchain transactions to become smaller and smaller in the coming years,” said DEXTF’s Marchioro.

Meanwhile, crypto entrepreneur George Harrap added: “The rise of crypto has been dependent on Asia since Mtgox was founded in Japan. It’s also tied to the UTC+8 time zone, aka Beijing time, China is where the #DeFi users are, and other places are irrelevant by comparison.”