Bitmain Will ‘Burn’ 12% of Bitcoin Cash Txn Fee, Calls on Other Miners to Follow

Cryptocurrency mining rig manufacturer and mining pool operator Bitmain has announced that it will destroy a portion of the transaction fees that it accrues from mining Bitcoin Cash blocks in a bid to support the economic health of the network.

AntPool, the Chinese company’s mining pool, made the announcement on Friday, explaining that it will “burn” 12 percent of all the transaction fees from Bitcoin Cash blocks that it mines by sending them to “burn addresses,” whose funds are unspendable.

Arguing that Bitcoin Cash “is at the tipping point of becoming a widely used public blockchain,” Bitmain explained that burning a portion of the network’s transaction fees will strengthen its internal economy and help investors “profit from the growth of BCH.”

From the statement:

“While having active users spending BCH is very important for the ecosystem, having investors who hold BCH is also a fundamental requirement for maintaining a strong economy. Without these holders, BCH’s exchange value loses significant support. We believe that they too should profit from the growth of BCH by their continued stake in the Bitcoin Cash ecosystem. The transaction fees earned by miners are an important growth indicator of the BCH ecosystem, and if a portion of the fees are burnt, it is effectively miners sharing revenue with the entire BCH network.”

By reducing the total supply of Bitcoin Cash in circulation, Bitmain believes that it can reduce sell pressure on the coin, ultimately making it more valuable.

Those comments are notable, given that many of Bitcoin Cash’s advocates — a group that includes Bitmain CEO Jihan Wu — argue that Satoshi’s vision for cryptocurrency was that it should be a currency first, not a store of value.

Source: CoinDance

At present, AntPool accounts for 7.3 percent of Bitcoin Cash blocks mined within the past week, though it has mined more than 10 percent of blocks mined in the past 24 hours.

Bitmain called for other mining pools to follow its example and burn 12 percent of the transaction fees from blocks that they mine, which would make the practice de facto economic policy for the network.

Featured image from Shutterstock.

Share
Josiah Wilmoth @Y3llowb1ackbird

Josiah is the US Editor at CCN, where he focuses on financial markets and cryptocurrencies. He has written over 2,000 articles since joining CCN in 2014. His work has also been featured on ZeroHedge and Investing.com. He holds bitcoin, but does not engage in day trading. Follow him on Twitter @y3llowb1ackbird or email him directly at josiah.wilmoth(at)ccn.com.

Show comments

News Tip?

tip (at) ccn.com

Advertisement


About Us

CCN Markets is a financial news site reporting on U.S. Markets and Cryptocurrencies. Op-eds and opinions should not be attributed to CCN Markets. Journalists on CCN Markets follow a strict ethical code that you can find here. You can contact us here. You can read more about us here. Find our journalists here. U.S. Office: New Jersey, USA.