- Ethereum was more profitable to mine than Bitcoin in September 2020
- Mining revenues soared because of the excitement over decentralized finance
- As DeFi excitement wanes, observers are watching closely the launch of Ethereum 2.0
During the month of September, revenue from mining Ethereum has eclipsed that of Bitcoin’s thanks to the excitement surrounding decentralized finance (DeFi).
According to the data from analytics firm Glassnode, miners in the Ethereum network collected 450,089 ETH worth $168.7 million. This is a 39% increase from the previous month’s total of $113 million, Cointelegraph reported.
In contrast, miners in the Bitcoin network netted only $26 million in September, which is a decrease from the $39 million they earned the previous month. This effectively makes mining Ethereum more profitable than mining Bitcoin.
The increase in miner revenue came from the community’s excitement over decentralized finance (DeFi).
Several DeFi protocols and tokens made headlines last month. YFI, the governance token of Yearn.finance reached its all-time high of $43,678 on Sept. 12. That’s twice the all-time high of Bitcoin in 2017. Other noteworthy DeFi tokens that made headlines last month include UNI, the token of automated market maker UniSwap, and Sushi, the token of on-chain protocol SushiSwap.
Uniswap made headlines for dropping at least 400 UNI to anyone who used the Uniswap protocol prior to September 1. At one point, each UNI was worth $8, which meant anyone who received 400 UNI immediately had $3,200 in one day.
DeFi without a doubt has renewed the demand for Ethereum. As more users want to get a piece of the DeFi tokens, the price of each transaction fee has ballooned. Cointelegraph noted that at one point, a standard transaction on Ethereum hit at least $15 on average. The publication said this is good in the short-term, as the miner revenue suggested profits for miners, but it could put off casual users because buying a token on Ethereum became very expensive.
“In fact, this very issue may be one of the main reasons for the sharp correction seen in DeFi token prices over the last month,” Cointelegraph added.
While the DeFi craze has subsided and majority of DeFi coins in sharp correction, observers are looking forward to the eventual launch of Ethereum 2.0.