According to CryptoPotato, Ethereum, a decentralized network, has generated a profit of $369 million in the first quarter of 2024. If this profit level continues, the blockchain could generate around $1.5 billion for the year. The revenue model of Ethereum is based on network fees, which are the gas users pay for making transactions. Gas costs spiked in early March but have now fallen back to yearly lows. A portion of the ETH is burned and removed from circulation for every transaction, which benefits existing ETH holders as issuance becomes deflationary during times of high demand.
The issuance of new ETH to the network’s validators and stakers as an additional economic reward is considered as 'expenses'. The difference between the daily USD value of the burned ETH (revenue) and the newly issued ETH (expenses) represents the daily earnings for existing ETH holders. Crypto investor Ryan Sean Adams stated that Ethereum is unlike other blockchains, having generated almost $1 billion in earnings over the past 18 months. This places Ethereum among the top 20 entities globally in terms of buyback yield at 0.23%.
On April 19, venture capitalist Tomasz Tunguz stated that Ethereum was the most profitable software company in Q1 2024, generating $370 million in profit on $825 million in revenue, equating to about a 45% net income margin. If Ethereum were to trade on the New York Stock Exchange or the NASDAQ, it would top the net income margin (%) charts, surpassing Microsoft, Adobe, and Veeva. Despite these impressive figures, ETH markets experienced a dip, with the asset dropping below $3,000 for the first time in two months. However, the trend started to change in the following hours, and ETH bounced off to about $3,100. The asset has now retreated almost 25% from its 2024 peak and remains down 38% from its 2021 all-time high.