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Bitcoin [BTC]: King coin’s miners earn fees eight times more than other top cryptocurrencies




Bitcoin [BTC]: King coin’s miners earn eight times more in fees than top cryptocurrencies
Source: Unsplash

The incredible price rally which stormed the market during the closing days of the previous week not only sent Bitcoin prices soaring, but also the fees for its miners. In comparison to other top cryptocurrencies, the king coin blew its competitors out of the water.

According to a report based on’s OnChain FX rankings by the cryptocurrency analytics firm Longhash, Bitcoin’s transactions fee mirrored its price pump. Longhash compiled transaction fees over a 24-hour period beginning at 0950 UTC on May 10, 2019. It recorded Bitcoin amass a whopping $580,000 in transaction fees for the period.

Source: Longhash

To put this into context, Bitcoin transaction fees were eight times higher than all cryptocurrencies listed on Messari’s OnChain FX.

Ethereum took the second spot, with Messari reporting that ETH miners earned around $68,000 in mining fees on May 10. Interestingly, Messari’s rankings have Ethereum behind XRP, based on Y2050 Marketcap.

Litecoin [LTC], the fifth largest cryptocurrency in the market, which saw its price skyrocket prior to its August 2019 halving, came in a very distant third. The digital silver recorded a measly $1,100 in transaction fees, or 1.61 percent of Ethereum’s fees.

Further, the remaining cryptocurrencies fared even worse, with the next seven coins, Lisk [LISK], Bitcoin Cash [BCH], Monero [XMR], Dash [DASH], XRP, Dogecoin [DOGE], and Ethereum Classic [ETC] amassing just $1,500 in fees. Given this stark disparity between the transaction fees paid for the top cryptocurrency, compared to its altcoin counterparts, the report stated,

“While many proponents will likely cite this as a win for altcoin users, who are theoretically left with less fees to pay when sending transactions, Bitcoin’s daily fees are an example of the currency functioning as its creator(s) intended.”

Longhash further referenced the risk of 51 percent attacks and stated that high transactions fees will prevent such threats. Citing Satoshi Nakamoto, the report highlighted that this is a “way of letting users pay additional money to have their payments prioritized.” The high fees would incentivize miners to “donate their device’s resources for the purpose of verifying transactions.”

In the imminent future, with Bitcoin’s mining rewards set undergo its third halving, transactions fees will prove a more important incentive. From May 2020, mining rewards will drop down to 6.25 BTC per block, resulting in Bitcoin’s fees becoming a more important “financial incentive,” added the report.

The report concluded,

“Many other digital assets, however, take approaches that differ widely from Bitcoin’s governance model. In these circumstances, low fees are something to strive for.”

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JP Morgan: Big banks stand corrected as Bitcoin rally past intrinsic value; admits current surge mirrors 2017 rise




JP Morgan: Big bank stands corrected at Bitcoin rally past intrinsic value; admits current surge mirrors 2017 rise
Source: Pixabay

Big banks are riding a FOMO wave as the Bitcoin bull-run is just beginning. Spearheaded by the changing colors of JP Morgan, which recently forayed into the digital assets world, the banking elite is now suggesting that their initial stance on Bitcoin and the larger cryptocurrency world might have been off.

A recent chart by JP Morgan shows the current BTC price veer upwards chiding the “intrinsic value” the big bank placed on the virtual currency.

Based on the article by Bloomberg, the price of the coin would reverse towards the end of December 2018 and then make marginal gains until May 2019, all under the $5,000 mark. In reality, the BTC price, after dropping to “rock bottom” at just above $3,100 in early December 2018, edged upwards.

Several spurts of growth were seen in early January and February, prior to a massive April ascendance. On April 2, Bitcoin did away with the bank’s value mode and amassed a daily gain of over 15 percent, fuelling its current rise. Breaking the $5,000 ceiling in the process, which was pegged to remain intact well into May 2019, the king coin is now almost $3,000 ahead of the mark and is not looking to stop.

Source: Bloomberg

It should be noted that JP Morgan’s “intrinsic value” is calculated on the basis of the marginal cost of production, electricity prices, and hash rates. This model does not take into account, at least on absolute terms, the anticipatory effect of the 2020 halving, which, according to a slew of analysts is the behind the price rise.

Nikolaos Panigirtzoglou, the MD in the Global Market Strategy team at JP Morgan stated that Bitcoin breaking through its “intrinsic value” showed signs of mirroring its 2017 bull run. He evidenced this move by comparing the pre-December 2017 slump to the one seen prior to the current bullish swing.

The analyst added:

“Over the past few days, the actual price has moved sharply over marginal cost. This divergence between actual and intrinsic values carries some echoes of the spike higher in late 2017, and at the time this divergence was resolved mostly by a reduction in actual prices.”

With the analyst admitting that the imparting of an “intrinsic or fair value” to a cryptocurrency, much less a volatile one like Bitcoin, is a “challenging” ordeal, a mere JP Morgan acknowledgement of a Bitcoin bull-run is a remarkable sign for the digital assets industry, especially given the bank’s and its CEO Jamie Dimon’s Bitcoin-bashing in the past.

Mati Greenspan, senior market analyst at eToro attested to the same, adding a key point that JP Morgan failed to take into account in their calculation. He stated:

“Great to see JPM finally admitting that Bitcoin has intrinsic value.
Now wait till they understand that miners who run a surplus tend to begin hording.”

Despite Bitcoin slumping at press time, recording a 1.23 percent decline against the dollar, the prospects look positive. After recording a massive gain on 19 May, briefly surging past $8,000 for the second time in a week, Bitcoin created a High-Low [HL] at $7,100, which many analysts look at with glee.

This HL immediately following last week’s pull-back caused due to post-Consensus bears, a Bitstamp sell-order and market correction showed the king coin’s bullish persistence and can even be a foundation for a $9,000 ascendance, defying any “intrinsic value” expectations.

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