When the Ethereum network becomes more popular to use, it is a matter of time until the fees go up. Unfortunately for many people, the mean fee on the network has hit a new all-time high. It is expected that this trend may continue for some time to come.
Ethereum Mean Fee Sets New Record
It is uncanny how different cryptocurrency ecosystems can become too expensive to use. Although a high fee will not dissuade Ethereum blockchain users from sending and receiving payments, the cost for doing so is problematic. Most of these concerns will be addressed in the future when ETH 2.0 rolls out. Unfortunately, that will not help affected users today.
As the Ethereum mean fee sets a new all-time high, the situation becomes painfully apparent. On average, suers paid $25.9 in fees in the past week. That in itself is a problematic number of the second-biggest cryptocurrency by market cap. As the Ethereum price recently surpassed $4,000 for the first time, more and more people seem eager to explore everything this ecosystem has to offer.
Making matters worse is how the current daily fee chart doesn’t bode well for Ethereans either. Per BitInfoCharts, there is a strong increase in transaction costs since early May 2021. The recent spike, followed by another spike, has brought today’s fees to over $66. It is a substantial amount to pay for an Ethereum-based transaction, even if it represents “just” 0.016 ETH. This situation is unsustainable in the long run and will cause issues for all users and service providers alike.
It is not uncommon for the Ethereum mean fee to rise; however, There are certain cycles when transactions become more expensive. Two substantial rises in quick succession are rather unusual. There is a steep price to pay for increasing the Ethereum network activity. An ecosystem that caters to developers and coders is quickly becoming an unfavorable option despite its global reach.
Big Bump In Transactions
Coinciding with the rising Ethereum mean fee is a strong increase in network activity. This uptrend has been brewing since early March 2021. With a gradual increase in transactions comes a higher cost to process data over the network. As the transaction count grows by leaps and bounds in recent weeks, this high mean fee was somewhat to be expected.
The big question is what is triggering this sudden increase in network transactions. Outside of the price momentum, very little has changed for Ethereum. There is still significant interest in decentralized exchanges and decentralized finance. However, that alone does not explain the sudden increase in network activity.
Per ETHGasstation, the same “gas guzzlers” remain in place. Uniswap and Tether generated millions in fees every month. 1Inch Exchange, Uniswap, and an unnamed smart contract complete the top five. As the average gas prices now sit between 251 and 314 gwei, a problematic situation ensues. Solving that situation will not be easy whatsoever.