Ethereum has been delivering exceptional performance lately. The asset broke several personal records. An array of all-time highs were achieved by the altcoin. At the time of writing, ETH had retraced from its all-time high of $1,689.19 to $1,623.98. Despite this fall, the asset kept moving ahead. However, along with the price of ETH, the gas fees of the network also noted a massive surge.
Ethereum Gas Fees Hits ATH
The transaction or gas fees of ETH have always posed a major problem for the network. While the activity in the Ethereum market is surging, the gas fees seem to be following suit. The average transaction fee on the Ethereum network was at a high of $23.27 on 4 February 2021. This high fee has even caused trouble in the DeFi space that has urged users to look for alternatives like Flamingo from Uniswap or SushiSwap.
This chart from YCharts reveals that ETH had witnessed spikes in its gas fees when the altcoin was prepping for a rise in its price. Amidst this rise in its transaction cost, a Japanese cryptocurrency exchange decided to put a hold on ETH withdrawals. The crypto exchange, Liquid Global Official announced,
“We have temporarily halted ERC-20 and ETH withdrawals due to spiking GAS fees.
Service will be resumed once GAS fees return to normal levels.
All other crypto currencies are operating as per normal.
Thank you for understanding”
While exchange awaits the depletion of ETH’s gas fees, several users of the Japanese platform expressed fear regarding their funds. A Twitter user, who goes by the username, resolute pointed out that the exchange hadn’t processed the transactions that were pending.
Additionally, Vitalik Buterin along with several from the Ethereum community were trying to implement EIP-1559 which could have kept the gas fees in check. However, a large amount mining pools were opposing this EIP. In a recent report, Grayscale identified the benefits of inducing EIP-1559 into the network. The report read,
“If activity increases and the supply of Ether decreases due to burning, a supply and demand curve would indicate an increase in the unit price of Ether because each unit would need to satisfy a greater proportion of economic activity. If EIP-1559 is implemented, it would institute a consumption mechanism that should serve as a positive feedback loop for Ether’s price.”