Bitcoin and Ethereum Revenue Jumps in May Driven by Ordinals and Enterprise Adoption
In May, Bitcoin revenue rose by 249% YoY, while Ethereum network fees increased by 53.7% according to a report by the ETC Group. This surge in network revenues was largely driven by ordinals for Bitcoin and increasing adoption of Ethereum enterprise solutions.
Bitcoin and Ethereum Network Growth
Despite ongoing headwinds, the total crypto market cap stagnated near $1.1 trillion in May. On the macro level, US debt ceiling concerns and regulatory pressure from the US Securities and Exchange Commission (SEC) and UK’s Financial Conduct Authority (FCA) impacted the crypto market. However, network revenue for Bitcoin and Ethereum continued to grow significantly.
“Revenues generated by the two largest blockchains by market cap rose substantially in May due to increasing user bases and new technological developments, most notably ordinals for Bitcoin, and increasing adoption for Ethereum enterprise solutions,” wrote ETC Group Research team.
Ordinals Helped Push Bitcoin Revenue Up 249% YoY in May
According to the ETC Group report, ordinals were the largest contributor to a 249% YoY increase in Bitcoin network revenue in May. Ordinals allowed BTC miners to reach multi-year highs in transaction revenue, with transaction fees accounting for 29.57% of monthly revenue. This surge in transaction fees has not been seen since the 2017 bull market.
Ethereum Network Fees Jumped 53.7% in May
Within the same period, Ethereum network fees rose from $241 million to $448 million, marking a 53.7% surge in revenue. The increased demand for Ethereum blockspace drove this exceptional growth. Despite fears of a significant withdrawal rout after the Shapella upgrade, renewed interest in staking was evident, with the amount of staked ETH on the mainnet rising by almost 20% to $46 billion worth of ETH at the end of May.
Crypto Regulation in the US
The crypto market has received hostile treatment in recent months, primarily from regulatory authorities in the US. The SEC, in particular, has been active in cracking down on crypto-related activities. Their actions prompted lawsuits against major entities such as Coinbase and Binance. Nonetheless, blockchain’s adoption has been adopted by major banks, who have expressed interest in tokenisation.
Tokenisation Sees Major Banks Eye Blockchain Adoption
State Street and Citibank have indicated their support for blockchain and tokenisation. State Street is planning to bring $1.4 trillion worth of assets to the blockchain through the tokenisation of ETFs. Citibank believes that tokenisation could see up to $4 trillion worth of liquid and illiquid assets merged on-chain.
The rise of Bitcoin and Ethereum network revenues in May is a significant indicator of the continued growth potential of the crypto market despite ongoing regulatory and macroeconomic uncertainties. Furthermore, the increasing interest expressed by major banks in tokenisation and blockchain adoption suggests a bright future for the technology.
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