Before diving into the main topic, let's examine the "accidental incident" that occurred on the Ethereum network on September 27. According to OKLink's Ethereum network tracking, at 19:10:08 Hong Kong Time (block height 13,307,440), a wallet paid 7,676.62 ETH (≈ $23.54 million at OKX's exchange rate) as a gas fee for a $100,000 USDT transfer to DeversiFi.
Following the incident, DeversiFi swiftly tweeted that they were investigating the cause. The miner who mined the block containing this transaction ranked among the top 10 block producers over the past 7 days but remained unidentified initially. By the next morning, the miner confirmed they would return the 7,626 ETH paid mistakenly as gas fees. This concluded the unusual event.
This incident highlights Ethereum miners, who typically operate behind the scenes. It also raises questions: How has miner income changed since EIP-1559 went live?
How Do Ethereum Miners Earn Income?
Under Ethereum's PoW consensus mechanism, miner revenue comes from three sources:
Block Rewards:
- Fixed rewards for mining new blocks (including uncle blocks).
- Stable but affected by Ethereum's difficulty bomb mechanism.
Transaction Fees:
- Gas fees paid by users for transactions/contract interactions.
- Historically a major income stream for miners.
MEV (Miner Extractable Value):
- Profits from reordering or excluding transactions (e.g., arbitrage, front-running).
Let’s analyze each component post-EIP-1559.
1. Block Rewards: Declining But Offset by ETH Price
Ethereum’s transition to PoS involves a difficulty bomb, which gradually increases mining difficulty to discourage PoW. Past adjustments (e.g., EIP-649 in 2017) reduced block rewards from 5 ETH to 3 ETH.
Post-EIP-1559 (since August 2021), miners have earned 1.44M ETH daily (79.2K ETH total), a 50%+ drop compared to early 2021. However, in USD terms, rewards remain steady (~$43M/day) due to ETH’s price appreciation.
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2. Transaction Fees: Burned vs. Priority Fees
EIP-1559 splits gas fees into:
- Base Fee: Burned (removed from circulation).
- Priority Fee: Paid to miners for faster processing.
While base fee burns reduce miner income, priority fees thrive during high-demand periods (e.g., NFT drops). Since EIP-1559:
- Average gas fees fluctuated (0.0043–0.017 ETH/transaction).
- Net miner earnings: 107K ETH ($320M+ at current prices).
3. MEV: A Growing Revenue Stream
MEV (Maximum Extractable Value) refers to profits from transaction reordering. In 2021:
- Total MEV extracted: $708M (up 329% YTD).
- Miners capture 12% (~$85M) as fees; the rest goes to arbitrage bots.
FAQ: Ethereum Miner Economics
Q1: Did EIP-1559 make mining unprofitable?
No. While block rewards dropped, USD-denominated income stayed stable due to ETH’s price rise and priority fees.
Q2: How does MEV benefit miners?
Miners earn extra fees by prioritizing high-value transactions (e.g., DeFi arbitrage).
Q3: Will Ethereum 2.0 eliminate miners?
Yes. PoS replaces miners with validators, ending block rewards and MEV opportunities.
Conclusion
EIP-1559 reduced Ethereum miners’ ETH-denominated earnings but not their USD-equivalent income. Factors like:
- ETH price surges,
- Priority fee demand (e.g., NFT trading),
- MEV growth,
have cushioned the impact. As Ethereum moves toward PoS, miners face a sunset phase—but for now, profitability persists.