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Ethereum (ETH) transaction fees break above all ATHs

Mon 13 Dec 2021 ▪ 10h12 ▪ 3 min read — by Katie Donaldson

Ethereum gas fees have been breaking all records possible, reaching an average of $48.33 in November. Bitсoin (BTC) and other cryptocurrencies’ transaction prices are far behind that number, therefore, users keep switching to other networks.

ETH bringing more harm than good

According to analysts, this will have a negative effect over blockchain as a whole and could be threatening the Ethereum network’s existence.

This November average is 16 times higher than Bitcoin’s, which has actually dropped down below $3. Cardano (ADA) and Ripple (XRP), ETH’s rivals, saw average gas fees of just $0.38 and $0.32 respectively,

Despite being the second largest by market cap, the Ethereum network is the foundation for non-fungible tokens (NFTs) and decentralised finance (DeFi). Those have taken root in every area possible, so it’s no surprise how many corporations and firms are taking part in the crypto industry.

“[High gas fees] provide a large obstacle for an increase in adoption of the asset compared to other cryptocurrencies with lower fees,” an analyst for Cryptocompare, a research firm, commented.

“Gas fees are insane,” said one user on the Ethereum Reddit page. Another said: “If the Ethereum network can’t fix its gas fees, it won’t be used by the average consumer.”

However, Total Value Locked (TVL) in its ecosystem still grew 8.6% to hit $178 billion (~£134 billion) in November alone. While other cryptocurrencies did bring high returns to their investors, the volatility of these assets have surely rattled their nerves. For example, in November Solana (SOL) saw realised volatility of 105%, while Bitcoin’s levels hit 65%.

Gas fees on the Ethereum network have approached all-time highs. Ethereum developers are working on solutions, for example, expanding Ethereum layer 2 in order to enable various activities to happen away from the core network.

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Katie Donaldson avatar
Katie Donaldson

I went full time crypto back in June 2018, and have never looked back. I want to help persuade as many people as possible to come and build the decentralised future! Let’s go!

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.

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