Saturday, September 23, 2023

Ethereum’s Cheap Streak: Will it Last?


The median transaction fee on the Ethereum network is $6.67, and the average transaction charge is $15.31. It’s the cheapest it’s been since September 2021.

Thanks to the impact of the Crypto-Bowl, cryptocurrency enthusiasts can rejoice as their favourite tokens gain popular acceptance. Still, Ethereum supporters may rejoice because trading ETH hasn’t been this inexpensive in months. According to L2Fees data, practically all of the most popular infrastructures charge less than $1 on average. When it comes to transporting ETH between $0.31 and $2.18 to switch tokens. It is widely acknowledged to have a more complicated procedure.

Ethereum is Getting Cheaper

Ethereum is a blockchain that is similar to that of the Swiss Army. This network hosts big dApps, decentralized exchanges and enterprise smart contracts. Additionally, are the altcoins, shitcoins, stablecoins, NFTs, and a slew of other creative goods.

Everything has a cost. Also, Ethereum’s fees have skyrocketed as a result of its growing popularity. Furthermore, hurting adoption prospects in the short term and spawning a slew of alternative blockchains and scalability initiatives.

However, things look to be shifting. The average transaction cost on the Ethereum blockchain has reached $15.31, according to Bitinfocharts. It is a level not seen since October 2021, when fees were around $13.

Fees Matter

The problem of fees is essential to Ethereum’s long-term viability (and any blockchain for that matter). Users who make transactions compete in a form of the bidding process on Ethereum. Also, all other proof-of-work blockchains to have their operations executed more rapidly.

As a result, the sooner your transaction is confirmed, if you pay miners more fees. Unlike Bitcoin, though, Ethereum is a Turing-complete blockchain, which means it can run complicated decentralized applications.

However, the more the transaction’s complexity, the more mining power is necessary to complete it. As a result, it’s common to see fees of several hundred dollars for a sophisticated token swap. Particularly on rapid trades where a few seconds can mean the difference between profit and loss. Such as valid arbitration or exploiting bugs for more shady purposes.

What Now?

Vitalik Buterin’s estimates the new Ethereum Consensus Layer. It was formerly known as ETH2.0. According to him, it aims to be proof-of-stake and provide scalability solutions like sharding. Its potential is bringing transaction processing capacity to close to 100,000 transactions per second.

However, it is a long road ahead, and many people are apprehensive. Meanwhile, the best options are to adopt L2 solutions such as Polygon or Loopring. Where transferring tokens costs less than $1 – or to switch to competitor blockchains like BSC or Solana.

Jacob Yang
Jacob Yang
Jacob Yang works at Cryptoconstellation as a writer. He has been working in finance for the past 6 years. Jacob loves sharing news about the cryptocurrency world and he, himself has invested in a few. Jacob enjoys travelling and finding the best restaurants wherever he goes.

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