An eruption of memecoins and nonfungible tokens on the Bitcoin blockchain has reshaped the revenue profile of miners and stirred questions about how lasting the upheaval will prove to be.
New software known as Ordinals paved the way for the NFTs and meme tokens to come to the network this year. Galaxy Digital Holdings Ltd. says the Bitcoin NFT ecosystem could be worth $4.5 billion by 2025, while about 25,000 memecoins have been tallied on the blockchain since they first emerged in March.
The NFT and meme-token craze spurred record transactions and an ensuing fee windfall for miners, who run the computers underpinning Bitcoin. At one point in May, transaction fees made up over 40% of revenues, whereas miner income is usually dominated by the new Bitcoin they get for securing the blockchain.
“The Ordinals protocol has stimulated a seismic shift in the Bitcoin mining landscape,” said Jihan Wu, chairman of Singapore-based Bitdeer Technologies Group, one of the top crypto miners by computer power.
Ordinals and a crypto rebound have eased the pressure on mining…