- Insights
- Cryptocurrencies
- Stocks
- White Papers
- Industry
- Geography
When it comes to cryptocurrencies, NFTs, and DeFi, gas fees become crucial and one of the controversial topic to discuss. Paying gas fees is a major step to transacting cryptocurrencies, and mining digital assets and is also an important factor in DeFi. Gas fees are a significant cost catalyst for transactions. Ethereum is one of the major cryptocurrencies in the crypto market which has always been in controversies due to its high gas fees. Transactions fees are quite high on the Ethereum network because it is one of the most-used blockchain networks in the world. According to reports, ETH investments have risen exponentially since its inception, which has eventually led to an increase in its market value. As the ETH token rose in value, so did the Ethereum gas fees. After Bitcoin collapsed, Ethereum went down with it, hovering around the US$2,000 mark, from its all-time highs of more than US$4,000 in November 2021. But its market value might experience a slight surge as currently, the ETH gas fees have sunk to the record lowest since July 2021. With the ETH 2.0 en route, this phenomenon might actually aid Ethereum to overtake Bitcoin in the future to become the largest cryptocurrency in the world. But still, investors are quite sceptical about further investing in Ethereum after the crypto fell by leaps and bounds over the past few months.
Ethereum is one of the most powerful altcoins in the crypto world. Experts believe that as ETH developers are implementing several developments in its network, its prices may finally start to rise and might even go up more than 300% in 2022. ETH was launched in 2015 and within an astounding period of time, its value grew from around US$0.31 to around US$4,000. But Ethereum has always been surrounded by controversies due to its high gas fees. The crypto's developers have been working extensively to curb all its shortcomings, including finding different ways to reduce the Ethereum transaction fees. The ETH 2.0 upgrade is proof of developments that the developers have been working on. This upgrade not only aims to make ETH transactions faster but also far cheaper. If the update is implemented successfully, the reduced fees will open new possibilities for the crypto market.
Ethereum network fee is currently the cheapest they have been over the past 10 months. The average ETH transfer fee sunk at around US$2.90 per transaction. Ethereum gas fees have been majorly dropping since February 2022. Experts believe that it is mainly because Ethereum transactions have reduced significantly since the crypto market slumped. Besides this, earlier this month, major cryptocurrencies including Ethereum faced another blow when TerraUSD and LUNA imploded taking away almost the entire value of the crypto. After UST lost its peg, users started shifting more Ethereum-based centralized stablecoins. Eventually, Tether and USDC became the biggest gas fee catalysts on the Ethereum network.
Since Ethereum has still not launched its upgrade, the crypto continues to face severe criticism for harbouring high transaction fees. Its lack of scaling features has led to the emergence of many distinct blockchains like Avalanche and Solana. Blockchains like this provide much cheaper gas fees. Gas prices are often lower due to lower transaction activities on its network, with even lower DApps working on them.
Even after possessing high transaction fees, Ethereum is still one of the most crucial cryptocurrencies in the market. The primary reason why Ethereum still remains superior to its other competitors is mainly that it's mostly decentralized. Its other competitors have fewer decentralization features. Nevertheless, investors are quite skeptical about its prospects and demand for some real advancements. The gas fees will once again start to rise after more investors jump into the network, which will make things the way they were. Until the developers successfully launch the upgrade, investors are not likely to believe in any manual market phenomenon.
