NFT Marketplaces Reduce in Ethereum Gas Usage Amid Fee Crisis After CoinEdition

• NFT marketplaces no longer top Ethereum’s gas usage, accounting for just over 3% of all gas usage.
• Despite Ethereum’s transition to proof-of-stake (The Merge), high gas prices persist.
• Investors are considering alternatives such as Cardano, which is more cost-effective due to the recent Hydra upgrade.

In a notable shift in Ethereum’s gas consumption patterns, Non-Fungible Tokens (NFTs) no longer reign as the top gas guzzlers on the network. Data from crypto analysis platform Nansen revealed that last week NFT marketplaces accounted for just over 3% of all gas consumption. In stark contrast, the decentralized exchange Uniswap used more than ten times as much, clocking in at 31.99%. Nansen tweeted about the development:

This shift occurred despite an ongoing rise in Ethereum gas prices. Such price increases are not new to the Ethereum network, but have become uncommon since Ethereum’s transition from a proof-of-work (PoW) protocol to a proof-of-stake (PoS) system, a move known as The Merge, was completed in September 2022.

Despite initial hopes that this transition would reduce gas taxes, recent events seem to tell a different story. One trader was reported to have paid as much as 64 ETH, worth approximately $118,600, in fees for a single transaction.

The Ethereum network’s congestion and high gas prices are partially attributed to intense activity caused by an increase in meme coin trading, such as PEPE tokens and Floki Inu. This led to an overflow of transactions and subsequently skyrocketing gas prices.

Ethereum’s community has responded to these challenges, and various layer 2 (L2) scaling solutions have been proposed to reduce gas prices. Layer 2 solutions, such as state channels, plasma chains, and rollups, aim to offload some computational workloads from the Ethereum blockchain, thereby reducing the need for gas and its costs.

The high gas prices have also prompted investors to switch to alternative networks, such as Cardano. The introduction of the Hydra upgrade, a layer 2 protocol on the Cardano blockchain, has made the network more attractive to investors by addressing the scalability issue.

The post NFT Marketplaces Reduce Ethereum Gas Use Amid Fee Crisis appeared first on Coin Edition.

See the original at CoinEdition

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