Coin Metrics' State of the Network: Issue 21

Tuesday, October 15, 2019

Weekly Feature

BTC Is Close to $1B of All-time Fees, But Fee Growth is Slowing

BTC is close to eclipsing $1 billion of cumulative, all-time transaction fees. As of October 13th, there have been $996,458,718 worth of fees paid on the BTC network.

Coincidentally, BTC is also close to reaching another milestone: $15 billion worth of all-time miner revenue (also known as “thermocap”). “Miner revenue” includes block rewards (i.e. newly issued tokens) and transaction fees, both of which are typically paid to miners. 

However, since early 2018, BTC fees have been accounting for less and less of cumulative miner revenue. On January 31st, 2018, BTC fees accounted for about 12% of the total miner revenue (block rewards account for the remaining 88%). As of October 13th, 2019, BTC’s cumulative fees were only 6.6% of total miner revenue. This means that since February 2018, BTC cumulative fees have not been growing as fast as cumulative block rewards. 

BTC median fees shot up to nearly $34 in late 2017, compared to a peak of only about $3 for ETH. BTC median fees have since fallen and have remained at less than $4 since February, 2018. This extreme difference in median fees is one of the main reasons for the decline in cumulative fees’ share of total miner revenue. 

Comparatively, as of October 13th, cumulative fees make up about 3.6% of ETH’s cumulative miner revenue. But, compared to BTC, the ratio has stayed relatively flat since the start of 2018. 

This is mostly due to the fact that ETH’s fees have grown much faster than BTC’s over the period. BTC’s cumulative fees have grown about 74% since January 1st 2018, while ETH’s have grown close to 400%.

BTC and ETH’s market cap to thermocap ratios (“thermocap” is another term for cumulative miner revenue) also flipped in early 2018. The market cap to thermocap ratio can potentially serve as a (rough) proxy of a crypto asset’s valuation to revenue, where the market cap represents an approximate valuation and thermocap represents the total revenue generated by the network. As of October 13th, BTC’s market cap to thermocap ratio is 10.3 compared to 3.2 for ETH. Interestingly, the S&P price to sales ratio is currently about 2.18.

Network Data Insights

Summary Metrics

Market cap was up for all five major crypto assets over the past week. For the fifth week in a row, ETH’s market cap outperformed BTC’s. ETH’s market cap was up 4.6% for the week (and was up 1% last week), while BTC’s market cap grew by 2% (compared to a 3.1% loss last week). 

Hash rate, however, grew more for BTC than ETH. BTC’s approximate hash rate was up 3.5% over the last week while ETH’s dropped by 0.5%. This is the second week in a row that BTC’s hash rate has outgrown ETH’s hash rate. 

Network Highlights

The combined total adjusted transfer value of the seven stablecoins we track (DAI, GUSD, PAX, USDC, TUSD, USDT, and USDT_ETH) approached all-time highs at the end of September, hitting $1,546,234,810 on September 24th. However, the total has since dropped, averaging about $618,000,000 a day over the first 13 days of October. The below chart shows the seven day moving average of the combined total.

A majority of the total stablecoin adjusted transfer value comes from Tether, which is still the biggest stablecoin by most measures. The activity on Tether continues to shift from USDT (which is the original, OMNI based version) to USDT_ETH (which is the newer, Ethereum based version of Tether). 

Market Data Insights

Over the past month, most major assets experienced sharp declines. Bitcoin is down 20 percent over this time period driven primarily by a concentrated movement from $10,000 to $8,000 on September 24. Notice the stair step-like pattern for Bitcoin prices reflecting long periods of muted price volatility interspersed with short periods of large and concentrated price movement. 

Ethereum is flat over this time period but significantly outperformed Bitcoin, perhaps because of an emerging recognition that demand for Ethereum's block space represented by fees is growing (and momentarily eclipsed Bitcoin's daily fees). Both XRP and Stellar have experienced modest single-digit gains for this month. Most other major assets are down, but less than Bitcoin. 

Notably, there was no significant impact on prices despite major developments in crypto markets over the past week -- a class action lawsuit was filed against Tether and Bitfinex, the SEC formally rejected Bitwise's ETF and filed an emergency action against Telegram's token offering, and multiple members of Libra Association dropped out due to regulatory pressure. 

The fact that prices for smaller assets remained resilient (relative to Bitcoin) in the face of these developments suggests that increased regulatory scrutiny has already been priced into the market. 

Coin Metrics Updates

This week’s updates from the Coin Metrics team:

  • Coin Metrics is hiring! We recently opened up 7 new roles, including Blockchain Data Engineer and Data Quality and Operations Lead. Please check out our Careers page to view the openings.

  • The CM Bletchley Index (CMBI) Insights section will return next week.

As always, if you have any feedback or requests, don’t hesitate to reach out at

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