Miners process transactions and receive fees from users (supply-side fees).

Bitcoin is a distributed ledger for transfer and store of value (a blockchain). Bitcoin was founded by a pseudonym Satoshi Nakamoto and launched in 2009.

BTC holders own and govern the protocol. They currently do not take a cut of the total transaction fees paid by users (revenue).

github

block explorer

Blockchains (L1)

Bitcoin

# Bitcoin Supply-side fees Methodology

## 1. Overview

Supply-side fees represent the total USD value of transaction fees paid by users to Bitcoin miners for processing transactions. This metric captures the revenue earned by the network's validators (miners) from transaction fees, excluding block subsidies. It answers the business question: "How much fee revenue is the Bitcoin network generating from user transactions?" The calculation involves aggregating transaction fees from all Bitcoin blocks and converting them to USD using end-of-day price feeds.

## 2. Data sources

The calculation uses the following raw data sources:
- **Bitcoin blockchain data**: Block records containing timestamps, block heights, block subsidies, and total transaction fees per block
- **End-of-day price feeds**: BTC/USD price data from two sources - Chainlink price feeds for dates after December 10, 2019, and CoinGecko daily market data for earlier dates
- **Protocol metadata**: Classification data for market sector and business segment identification

## 3. Step-by-step calculation

### Component A: Bitcoin block data processing
- **Purpose**: Extract and normalize transaction fee data from Bitcoin blocks
- **Logic**: Bitcoin block data is processed to extract key fields including block timestamps, heights, subsidies, and total transaction fees. The total fee amounts are converted from satoshis (the smallest Bitcoin unit) to full Bitcoin units by dividing by 10^8. This ensures fee amounts are in standard BTC denomination for subsequent calculations.
- **Key fields**: `block_timestamp` for timing, `block_number` for identification, `total_fee_amount` representing the sum of all transaction fees in each block

### Component B: Price data preparation  
- **Purpose**: Create comprehensive daily BTC/USD price dataset
- **Logic**: Price data combines two sources to ensure complete historical coverage. For dates after December 10, 2019, Chainlink price feed data is used and averaged by day to create daily prices. For earlier dates, CoinGecko daily market data provides historical BTC/USD prices. Both datasets are standardized with daily timestamps and consistent price formatting.
- **Key fields**: `timestamp` truncated to daily boundaries, `price` representing USD value per BTC, `timestamp_grain` indicating daily aggregation

### Component C: Fee calculation in USD
- **Purpose**: Convert Bitcoin transaction fees to USD values
- **Logic**: Block data is joined with price data by matching truncated daily timestamps. Each block's `total_fee_amount` (in BTC) is multiplied by the corresponding day's BTC price to calculate the USD value of fees for that block. The join ensures every block has an associated price for conversion.
- **Key fields**: Daily `timestamp`, `fees` representing USD-denominated fee amounts

### Final aggregation
- **Combining components**: Fee amounts are summed across all blocks within each day to produce total daily fee revenue in USD
- **Currency conversion**: BTC-to-USD conversion uses end-of-day pricing matched to the block's date, ensuring consistent daily rates
- **Time aggregation**: Block timestamps are truncated to daily boundaries, and all fees within each calendar day are aggregated
- **Final calculation**: The final metric represents the total USD value of transaction fees paid to Bitcoin miners each day, calculated as the sum of (block fee amount × daily BTC price) across all blocks in that day

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Portion of fees distributed to service providers or supply-side participants.

BitcoinBTC

Supply-side fees

Supply-side fees

Competitive landscape