Ethereum Faces Scalability Issues With Skyrocketing Gas Fees• May 9, 2022 3:37 pm • Comments
One of the major drawbacks of Ethereum that many industry experts have observed is the high gas fees of the network compared to other blockchains.
Many have stated that this would eventually become one of the major obstacles for Ethereum when it comes to scalability and future growth.
Fears of this particular issue became true just recently when fees on the network skyrocketed to $3300 which was an abnormal amount for the blockchain.
This sudden rise was reportedly caused by the recent Bored Apes NFT Sale which caused a high level surge of price on the network.
Although it was only temporary and prices have stabilized since then, the incident once again brought attention to this major problem of Ethereum which has caused many to seek cheaper alternatives such as RippleNet.
These gas fees are insane🤯 #BAYC #Ethereum #nft pic.twitter.com/4zIiBqb4ko
— NothingNiceCryptoClub (@Cryptohubclub1) May 1, 2022
Although the gas fee on the Ethereum chain has stabilized, it is still considered one of the highest in the industry. This is compared to what other blockchains are offering.
Ethereum gas fee is mainly determined by the demand and supply.
When the demand for the Ethereum networks or traffic increases, the cost of the gas fee is always increased.
That is what happened during the Bored Ape NFT sale, where thousands of Ethereum NFT users increased traffic on the network.
The Ethereum low scaling has been the biggest reason the gas fee is always rising.
To summarize, when the traffic on the Ethereum network suddenly rises, the fees for the transactions will increase significantly.
However, the bigger issue is that the fees on the network are already considered high even during periods of low traffic.
Compared to alternatives like XRP and XLM, the percentage of the gas fee compared to the transaction amount is a much larger percentage which will always be a deterrent for users looking to use it as a payment method.
Without any near term plan to address this issue, it is becoming more and more unlikely that Ethereum will be able to support more growth.
A user spent around 16ETH ($43,000) in Gas Fees, to mint 2 BAYC Otherdeed Plots😲
The high gas fees on Ethereum is becoming a pain point for users! Is it a concern for you too? #Algobitz #Gamefi #Ethereum #Solana #ETH #GasFees #BAYC #Metaverse #Blockchain
— Algobitz (@algo_bitz) May 5, 2022
The whole activity massively stressed the Ethereum blockchain that processed these transactions, and in turn drove up transaction costs for all projects on this blockchain. Some folks had to pay thousands of dollars for transactions valued at just a few dollars each.
This kicked off a heated debate about Ethereum’s scalability problems and Yuga Labs’ smart contract’s efficiency. That’s a good opportunity to better understand the concepts of ‘gas’ and ‘smart contracts,’ and what happened here.
At the time of writing, Etherscan data suggested that people have spent more than 64,700 ETH (more than $183 million) on transaction fees for Otherside NFTs alone.
This gas war between Otherside bidders also affected other transactions on the Ethereum network.
With this many issues, perhaps its time for users to start looking for another solution completely, especially if scalability is an important factor for the success of the project or blockchain application.
The “gas war” resulted in many would-be purchasers paying considerable fees for transactions that ultimately failed — and made using the Ethereum network for any other purpose temporarily unfeasible #xrp is the best
— $mokerKlub (@SmokerKlub) May 4, 2022
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