Two years ago, on October 11, 2021, u/2Miners announced the implementation of Bitcoin (BTC) and Nano (XNO) payments for their Ethereum (ETH) miners, due to very high fees on the Ethereum Network, that were harming their business, and their minersโ€™ profitability.

However, the experiment ended in September 2022 with โ€˜The Mergeโ€™ also ending Ethereum mining. One year ago, I collected public data from multiple reliable sources to report what happened in these 337 days of recurrent daily payments, and this is a brief summary of the results from what I found out.

FULL REPORT

You can read the full study from October 2022: https://drive.google.com/file/d/1hy7RA-k7_owtIClRugf9zlXKnR2Zfa3R/view?usp=sharing

In the PDF you will also find:

• Monetary theory and decentralization (by F.A. von Hayek);

• The problem (high fees = bad for business);

• How the payment system worked out for 2Miners.

THE RESULTS
Days on which payments were made with XNO: 337 days.

A - Number of miners growth
B - Hashrate production growth
C - Nano payments volume and costs
D - Costs for Bitcoin, Ethereum and Wise

A - NUMBER OF MINERS GROWTH

Daily average of all miners in the pool: 95,827 (100%);

- ETH miners: 51,066 (53.29%).

- BTC miners: 31,313 (32.67%);

- XNO miners: 13,447 (14.03%).

The first record we have about the number of miners dates from October 15, 2021, with

47,029 miners, of which they had as a payment method:

- ETH: 43,132 (91.71%)

- BTC: 1,751 (3.72%)

- XNO: 2,146 (4.56%)

On March 8, 2022, the number of miners more than doubled, reaching six figures for the first time, with 100,051 workers connected to the pool at the same time โ€“ an increase of 112.74% in 145 days.

- ETH: 47,897 (47.87%); +11.04%

- BTC: 35,053 (35.04%); +1901.88% (~20x)

- XNO: 17,101 (17.09%); +696.87% (~08x)

It is interesting to note that, in this period, the number of miners who received their payments in ether remained constant, which indicates that the growth of more than 110% in the number of pool workers was mainly due to new participants receiving through the alternative methods.

The highest number of workers connected on the same day was on May 4, 2022, with 130,561 miners. A 177.61% increase from Day 1.

On the last day of the study, September 14, 2022, the day before The Merge and, consequently, the end of mining on Ethereum, the total number of miners was 93,073. A reduction of 28.71% from the maximum, but within the average for the period.

B - HASHRATE PRODUCTION GROWTH

The first snapshot of the hashrate percentage produced by Pool2Miners across the entire Ethereum network was taken on October 21st, with 3.54% of all the hashrate on the network. This number rose consistently throughout the 337 days and maintained an average of 5.56% in the period.

Its highest value was reached on September 12, 2022, in the final moments of the study, at 8.06%. The most aggressive movement of increased production occurred in March.

The highest value in total hashrate production by miners receiving XNO as payment (excluding others) was 4,059 GH/s on April 18, 2021 and the maximum hashrate production dominance over the rest of Pool2Miners was 9.08% on January 20, 2022.

The average of both was, respectively, 2,652 GH/s and 5.41% in the period of 337 days; and the total amount of hashrate generated by โ€˜nano minersโ€™ was 885,895 GH/s.

C - NANO (XNO) PAYMENTS VOLUME AND COSTS

During the 337 days, 4.53 million payments were made in nano, totaling ำพ17.42 million transferred from the poolโ€™s Payment Address to each of the miners who chose XNO. With an average of ำพ3.84 for each payment.

When considering the daily exchange rate of XNO/USD individually on each of the 337 paydays, these equate to a total volume of $35.48 million, at an average price of $2.40/xno and an average value of $7.83/tx.

With a total circulating supply of 133.24 million XNO, the mining pool has moved the equivalent of about 13% of all available nano in almost a year.

- The average daily volume was $105,302 in dollars and ำพ51,692 in nano.

The largest volume of nano payment recorded was ำพ125,014 on May 22, 2022; and the highest

dollar payment volume on record was $232,095 on December 18, 2021.

Interestingly, all that volume being moved had an estimated cost of $35,387 over 337 days, or $105.00 USD/day, fully absorbed by the company, not affecting miners' payouts and profit.

These estimated costs only refer to the exchange operational fee in the XNO/ETH pair (average at 0.1%), in the most negative scenario, due to the monthly volume generated only in nano exchanges - according to Kraken's fee table.

D - COSTS FOR BITCOIN, ETHEREUM AND WISE

In order to demonstrate the economic advantages of choosing nano as a means of payment, I made some cost simulations based on the volume and values of payments in XNO, with the total cost in the case that other, more expensive payment methods, have been applied.

The fees used in the simulation are real and correspond to the average fees paid by all users in each of the 337 days, respectively. And were manually collected for this study.

The second most efficient way to receive payments would be through bitcoin, with around

$8.53 million in network fees, plus around $35,387 in BTC/ETH exchange transaction fees on Kraken.

In an XNO v. BTC comparison, the mining pool (or miners) saved around $8.5 million dollars

($8,539,179.7) in 11 months and completed operations in less than a second in the first, while they could have taken up to an hour in the other.

According to data collected on the provider's website (Wise), fees could vary between $14.55 million, considering the cheapest scenario, up to $18.76 million.

Based on the average value between the two estimates of $16.65 million, the company saved about $16.62 million dollars with XNO payments and about $4.57 million dollars with payments in BTC, within 337 days.

The last, less efficient method would be to hold payments in ether, despite being the method of choice for most workers. If all daily nano payments had been made with ETH, the total cost of

$89.46 million would have exceeded the transacted amount by 2.52 times.

Evidencing the infeasibility of high-frequency payments in this model.