Antpool, the mining pool operated by Bitmain Technologies, yesterday made the announcement that it is “burning” 12% of the transaction fees it receives from mining each block of Bitcoin Cash (BCH).
The announcement, which was made via Bitmain’s website as well on Facebook and Twitter, states that Antpool has started burning Bitcoin Cash by sending 12% of all transaction fees it receives for mining BCH blocks to “a black hole address” and that this voluntary burning is done for the benefit of the BCH ecosystem.
Antpool believes that Bitcoin Cash will only increase in popularity after the planned hard fork on 15 May 2018, which will change the block size from its current 8MB to 32MB and introduce basic smart contract functionality.
According to Antpool, although significant growth in BCH transaction volume is important for the health of the BCH ecosystem, it is important not to forget about the importance to the BCH economy of having investors who hold on to their BCH and don’t sell it:
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.
The basic idea is to attempt to increase the value of Bitcoin Cash by reducing the amount of BCH in circulation. But is unclear how much effect this action by Antpool will have on the price of BCH, and it is hard to imagine that other BCH miners will join it by also burning part of the BCH transaction fees that they earn.
According to data from Coin Dance, at the time of the writing, Antpool was responsible for roughly 7.3% of the BCH blocks mined within the past 7 days.
