Ethereum News Today – Headlines for August 4

ethereum ecosystem
  • Ethereum gas usage has reached all-time high and congestion has intensified
  • Transaction costs have soared on the Ethereum network recently
  • The ongoing situation at Ethereum isn’t because of DeFi alone

Ethereum News Today – Ethereum’s gas usage has reached all-time highs at press time. This situation has been consistent on the network in recent months. It has ensured that the network’s congestion is intensified. The overall transaction costs have been soaring on the Ethereum network. Even though many believe that DeFi may be responsible for this spike, recent data suggests that it is not just because of DeFi.

Ether has put its foot to the pedal in the last two months which has ensured that it generated new usage numbers. These record-breaking numbers have indicated an apparent rise in demand for the Blockchain network. The question is can the Ether network keep up the ongoing situation?

DeFi isn’t the Principal Reason Behind the Congestion on Ethereum

Of course, Ethereum enthusiasts will naturally attribute the current achievement to DeFi protocols including Uniswap, Compound, and yEarn (plus the launch of ETH 2.0’s testnet). Without a doubt, they are part of the high activity numbers. But they are not necessarily the principal reason behind the network’s congestion. Much of this responsibility rests with Ponzi schemes like MMM, Forsage, and Lion’s Share.

Going by the overall number of transactions and regular gas limits for contracts, the above-mentioned scam smart contracts were behind gas fees running into 5,600 ETH approximately in the last month. This figure is more than 10% of the total gas consumption. When you put this in perspective, regarding network usage, the three Ponzis mentioned here will be on par with Tether. Tether conducts transactions running to tens of millions and moves USD in billions on the Ethereum network.

Ethereum is Reportedly Working on a Solution

Since the middle of July, the Ethereum network has facilitated no less than 1 million transactions per day. These transactions have happened at 21 billion gas. When we exclude simple transactions, about 57 billion has been used for smart contracts exclusively. Next in line is Ponzi schemes which comprise more than 17 billion gas consumption. Then another 30% of smart contract activity completes that figure.

Due to these scams, the network’s gas prices are inflated and is sitting between 35 and 90 gwei. This is now obvious in the average transaction prices. A transaction on Ethereum currently costs $2. These high prices have not been seen since mid-2018. The fast-climbing ETH prices have been responsible for the congestion to an extent as well. Ethereum is reportedly working on a permanent fix for the problem. The network will implement a scaling solution known as ETH 2.0. ETH 2.0 will address the current predicament of the network.

Princess Ogono is a writer, lawyer and fitness enthusiast. She believes cryptocurrencies are the future. When she's not writing, she spends time with her adorable cat, Ginger and works out often.

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