Ethereum gas fees reach $500K as ETH price hits a 2020 high at $486
Miners of Ethereum earned a record $500,000 in fees in a single hour, which raised concerns about network stability.
Fees for transactions on the Ethereum network has recently reached a new hourly record. Miners on the network earned over $500,000 in just one hour today as Ether (ETH) rallied. Sitting at its 2020 high of $486, Ether rallied 10% today. The spike in network activity is thought to be related to the launch of Sushiswap. It is a fork of Uniswap that has hit $1 billion in total value locked in less than 24 hours.
The news may sound good for Ether mining. Their revenue is increased by higher fees and more transactions. Ethereum’s network hash rate has been growing consistently. It reached its 20-month high recently. This was despite the recent controversy about a proposal that aims to reduce block rewards by 75%. But, it points to an ever-growing issue in the sustainability of Ethereum in the short and long term. It seems to be that DeFi is leading to a renewed bull run for Ether. It also seems to be the primary cause of its technical issues.
The decentralized sector continues to push the activity beyond the network’s limits. Network congestion leads to a higher number of unconfirmed transactions. It leads to longer wait times and higher fees. This is as users compete to get their transactions confirmed faster. The issue also makes some smart contracts virtually unusable. This can be a critical issue for Ethereum’s future as a smart contract platform.
The biggest gas spender on the network has been consistently Tether (USDT). Uniswap, the decentralized exchange, and liquidity protocol, recently surpassed Tether as the smart contract that uses the most amount of gas.
The firm Uniswap also made media waves as it surpassed Coinbase in daily trading volume. This showcased how big DeFi is becoming in the digital asset space.
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