Ethereum is on a roll. The blockchain network just attained a new all-time high for daily transactions, while gas fees have been skyrocketing in the interim.
Ethereum’s daily transaction flow was fueled by a frenzy in the decentralized finance (DeFi) space that has thrown the market into a tizzy. According to the Ethereum Daily Transactions Chart, the record high was reached on Sept. 17, when the number of daily transactions registered at 1,406,016. The last time it even came close to these levels was in January 2018, when the ICO craze was at its height.
Soaring Gas Fees
Gas fees, meanwhile, have skyrocketed of late, with the average ether transaction fee hovering at more than $11 on Sept. 17 before easing a bit to $7.60 on Sept. 18. Part of the charm of sending cryptocurrency transactions is suppose to be the low fees that are below the market rate, so rising gas fees are another hurdle to overcome. It is a trend that prompted Coinbase Pro to stop shouldering the expense, choosing instead to pass along Ethereum gas fees to its users
The feverish pace of transactions on Ethereum has thrust the network’s scalability issues back into the limelight. While the cryptocurrency community has been awaiting Ethereum 2.0 for seemingly ages, the question still remains as to whether the next iteration of the network will be the solution users are hoping for.
Economist and trader Alex Kruger suggested in a tweet that the number of DeFi users could be around 114,000, based on his back of the napkin calculations. He points out that it is a low base compared to Coinbase, which boasts 32 million users, and therefore has “massive room for growth.”
The whole CryptoKitties fiasco in which the Ethereum network became clogged isn’t too far in the rearview mirror for users. If new users flood the DeFi space, and the network’s capacity is already over capacity, can the crypto community expect that Ethereum 2.0 will be able to handle this load?
Emmanuel Marchal, managing director and global head of sales at ConsenSys, recently told the Coinscrum podcast that he was “very confident” about Ethereum 2.0’s ability to fix the network’s scaling issues, adding:
“Ethereum benefits from having the largest community adoption and support, the largest amount of research around it done not by a single company but by a combination of companies and independent developers. And [this has been proven] over the last five years. It’s capable of innovating yet maintaining the security and sovereignty of the ecosystem at work.”
The industry is waiting with bated breath.