ETHUSD on TradingView.com<\/a><\/figcaption><\/figure>\nETH is trading at $3,042, up 0.4% in the last 24 hours. <\/span>It remains to be seen whether these changes and the reduction in fees will have the same effect in the second quarter of the year, and how this, coupled with a potential increase in trading volume, can push the ETH price to higher levels.\u00a0<\/span><\/p>\nFeatured image from Shutterstock, chart from TradingView.com\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"Not only has Ethereum (ETH) seen an impressive rise of nearly 100% in the first quarter of 2024 in terms of price action, but the Ethereum blockchain has also generated substantial profits of up to $369 million during this period. This unexpected profitability has raised questions about how a blockchain like Ethereum can be profitable.\u00a0 Ethereum Revenue Potential As noted in a recent analysis by the on-chain data platform Token Termina, the collection of transaction fees is a critical aspect of Ethereum’s business model.\u00a0 All network users are required to pay fees in ETH when interacting with applications on the blockchain, which serves as an important source of revenue for Ethereum. Once transaction fees are paid, a portion of the ETH is burned and permanently removed from circulation. This process, commonly referred to as “ETH buyback,” benefits existing ETH holders, as the reduction in supply increases the scarcity and value of the remaining ETH tokens. Thus, the daily burning of ETH contributes to the economic benefit of those holding Ethereum. Related Reading: Here\u2019s What Would Happen If The Bitcoin Price Fell Below $58,000 In contrast to the burning of ETH, Ethereum also issues new ETH tokens as rewards to the network’s validators for each new block added to the blockchain.\u00a0 These rewards are similar to traditional stock-based compensation and are designed to incentivize validators to secure and maintain the network’s integrity.\u00a0 Nonetheless, it’s important to note that the issuance of new ETH tokens dilutes the holdings of existing ETH holders. According to Token Terminal, the difference between the daily USD value of the burned ETH (revenue) and the newly issued ETH (expenses) represents the daily earnings for existing ETH holders, essentially the Ethereum blockchain owners. This calculation allows for the determination of Ethereum’s profitability on a day-to-day basis. Reduced Transaction Costs Drive $3.3 Billion Growth In addition to the overhauled revenue model implemented by the Ethereum blockchain, the launch of the much-anticipated Dencun upgrade to the Ethereum ecosystem at the end of the first quarter of 2024 brought significant changes, including the introduction of a revolutionary data storage system called blobs.\u00a0 This upgrade has reduced congestion on the Ethereum network and significantly reduced transaction costs on Layer 2 networks such as Arbitrum (ABR), Polygon (MATIC), and Coinbase’s Base.\u00a0 Implementing the Dencun upgrade, alongside the adoption of blobs and Layer 2 networks, has significantly impacted Ethereum’s revenue.\u00a0 According to Token Terminal data, the blockchain’s revenue has witnessed an 18% annualized increase, amounting to an impressive $3.3 billion. These revenue gains can be attributed to reduced transaction costs, making Ethereum a more attractive platform for users and developers. Related Reading: Bitcoin To $455,000: Expert Echoes Previous Halving Pattern Despite the positive revenue growth, it is essential to acknowledge the impact of market corrections and dampened investor interest in the second quarter of 2024.\u00a0 Over the past 30 days, Ethereum’s revenue has declined by over 52%. This downturn can be attributed to the broader market dynamics and the temporary decrease in investor enthusiasm.\u00a0 Examining the data over the past 30 days, Ethereum’s market cap (fully diluted) has decreased by 15.2% to $358.47 billion. Similarly, the circulating market cap has declined by 15.2% to reach the same value.\u00a0 Additionally, the token trading volume over the past 30 days has declined 18.6%, totaling $586.14 billion.\u00a0 ETH is trading at $3,042, up 0.4% in the last 24 hours. It remains to be seen whether these changes and the reduction in fees will have the same effect in the second quarter of the year, and how this, coupled with a potential increase in trading volume, can push the ETH price to higher levels.\u00a0 Featured image from Shutterstock, chart from TradingView.com\u00a0<\/p>\n","protected":false},"author":589,"featured_media":603939,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[13625],"tags":[1020,1026,6664,14690,1558,54512,8323,1946,8556,84762,6931,6864,6653,8686,78803,16260],"class_list":["post-603938","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ethereum","tag-blockchain","tag-blockchain-technology","tag-crypto","tag-crypto-news","tag-cryptocurrency","tag-defi","tag-eth","tag-ethereum","tag-ethereum-blockchain","tag-ethereum-ecosystem","tag-ethereum-price","tag-ethereum-price-action","tag-ethereum-price-analysis","tag-ethusd","tag-ethusdt","tag-latest-ethereum-news"],"acf":[],"yoast_head":"\n
Ethereum Blockchain's Q1 2024 Success: Unveiling The Factors Behind The $370M Profit Surge<\/title>\n \n \n \n \n \n \n \n \n \n \n \n \n \n\t \n\t \n\t \n \n \n \n \n \n\t \n\t \n\t \n