According to a popular on-chain analysis platform, Ethereum has surpassed Bitcoin in annual fee revenue, leading with a staggering $2.728 billion in fees, while Bitcoin follows with $1.3 billion in fees. The Tron blockchain ranks third with $459.39 million in fees during the same period, indicating its growing popularity. Solana and BSC rank fourth and fifth with annual fee revenues of $241.29 million and $176.56 million, respectively. By delving deeper into the revenue of the top L1s, we can better understand the fundamental health of these networks and their position in the competitive landscape.

Ethereum

Revenue Source: Ethereum’s revenue comes from gas fees, which originate from Layer 2 solutions built on Ethereum. These additional fees can be quite substantial. In 2021, Ethereum adopted the EIP 1559 upgrade, changing how fees are calculated and processed. The new fee system uses block-based and sender-specified maximum fees instead of auctioning gas prices. In March 2024, Ethereum’s daily revenue peaked at over $35 million, thanks to increased DeFi and NFT activities in the first quarter. The hype around meme coins also boosted transaction numbers, further driving revenue growth. Ethereum has surpassed Bitcoin in annual fee revenue, leading with $2.728 billion, especially excelling in decentralized finance (DeFi) and smart contracts. Despite the emergence of many blockchain networks offering lower fees and faster transaction times, Ethereum remains dominant, with users willing to pay higher fees to interact on this leading blockchain.

Bitcoin

Revenue Source: Bitcoin’s revenue mainly comes from transaction fees and miner rewards. Although Bitcoin primarily serves as a digital currency rather than a complex financial transaction platform, its network’s security and decentralization ensure its continued relevance and utility in the market. Bitcoin generated $1.3 billion in fees over the past year, closely following Ethereum. High revenue was driven by the surge in inscriptions at the end of 2023, providing more practical use cases for the Bitcoin network. Despite other blockchain networks offering lower fees and faster transactions, Bitcoin’s status and popularity remain unshaken, solidifying its role as digital gold and reinforcing its dominance in the cryptocurrency market.

Tron

Revenue Source: Tron earns revenue by charging fees on TRX transactions, which are then burned to drive token deflation. Tron is a low-profile giant, focusing more on the Asian market. It was launched in 2017 by Justin Sun, a flamboyant cryptocurrency entrepreneur known for spending $4.5 million on a charity dinner with Warren Buffett. Tron uses a more efficient but centralized Delegated Proof of Stake (DPoS) consensus algorithm, with over $9 billion in TVL, making it the second-largest DeFi participant after Ethereum. It also holds the second-largest amount of stablecoins, next to Ethereum. However, its ecosystem is quite isolated, with nearly $7 billion of its TVL coming from its lending protocol JustLend.

Solana

Revenue Source: The network employs a different fee model, where 50% of the fees are paid to validators and 50% are burned. Revenue peaked in March, exceeding $2.5 million. Since early 2023, Solana has been the fastest-growing blockchain network, occasionally surpassing Ethereum in NFT transaction volume and DAUs. It also boasts a vibrant DeFi ecosystem, attracting about $5 billion in TVL. The popularity of memecoins, capital growth from airdrops, technical upgrades addressing spam issues, and the emergence of new technology Blink have all contributed to its strong revenue and prominence. Although low gas fees and frequent token issuances mean Solana has higher operating costs, its active user base and daily transaction volume surpass Ethereum, ensuring higher revenue.

Avalanche

Revenue Source: Avalanche is supported by transaction fees paid in AVAX, which are burned after the transaction is completed. Avalanche is a Layer 1 blockchain focused on efficiency and interoperability. It utilizes the Solidity programming language, enabling developers to build applications compatible with both networks. Avalanche’s high revenue ranking is mainly due to the surge in transaction fees at the end of 2023. Following industry trends, Avalanche experienced significant growth during the AVAX inscription craze and the subsequent launch of the meme foundation by the Avalanche Foundation, boosting its overall revenue capabilities. By the end of December, network fees surged to $53 million, over 25 times higher than its revenue in April of the previous year.

This article outlines the revenue of the top blockchains and analyzes their performance. From these chains’ characteristics, it’s clear that in the current crypto industry, aside from Bitcoin as a decentralized ledger, almost all blockchains need to have the ability to generate revenue to survive long-term and securely. New narratives drive new revenue capabilities, and narrative-driven investments are usually the default choice for cryptocurrency buyers. We can look forward to seeing which new stories will emerge from these blockchains and whether new blockchains will rise to prominence.