Fees for transactions on the Ethereum network hit a new all-time high on Tuesday
According to Blockchair, Ethereum transantions fees hit $11.75 on September 1, with median transaction fees rising to $6.34. A development that comes as activity in the decentralized finance (DeFi) ecosystem continues to grow.
Fees for transactions on the Ethereum network hit a new all-time high
As previously reported, transaction costs began to rise precipitously earlier this summer — corresponding with the growth in trading on the decentralized exchange (DEXs) and other protocols that comprise the DeFi space. August, for example, saw more than $11 billion in trade volume across the DEX landscape.
Source: Blockchair, The Block Research
Median gas prices, denominated in gwei, also showcase the extent to which costs for transacting on Ethereum — from sending coins to constructing smart contracts — has shot up.
ETH Gas Station, which tracks such costs and offers estimates for how much should be spent depending on the desired transaction speed, currently suggests 479 gwei for a “fast” transaction and 400 for a “safe low” transaction.
Source: Blockchair, The Block Research
According to the site, decentralized exchange Uniswap and stablecoin operator Tether have spent the most on fees in the past 30 days, paying $12.7 million and $10.5 million, respectively.
CZ has hinted of a possible increment in ETH withdrawal fees on Binance if the issue persists
According to Binance CEO Changpeng Zhao, the high ETH gas cost on the Ethereum network is hurting crypto exchanges with every withdrawal by users.
According to Etherescan.io, it currently costs an average of 500 Gwei – approximately $ 5 – to have your Ethereum transaction processed on the network. For Ethereum users who want to have their transaction expedited, they currently have to part with at least 549 Gwei ($ 5.49).
Elsewhere, most exchanges are losing between $ 10 – $ 20 per withdrawal due to the platform’s fixed ETH withdrawal fee adjusted for activity on the Ethereum network. The sooner or later Ethereum withdrawal fee will have to be adjusted.
The high ETH network gas fees is causing problems for most exchanges, running with $10-20 loss on each withdrawal.
Will have to adjust our withdrawal fees sooner or later. ?
— CZ Binance (@cz_binance) September 1, 2020
The reason for this is that the DeFi industry’s expansion is happening at breakneck speed. The center of the action is Uniswap. Two days ago, Uniswap’s 24-hour volume exceeded Coinbase’s volume. This means that there are a large number of traders and productivity farmers using Uniswap to trade their tokens and thus causing congestion in the Ethereum network.
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