Transaction costs have risen to their highest levels in three months, putting Ethereum users at risk once more. According to Bitinfocharts, the average transaction cost has increased by roughly 240 percent since the beginning of August to $27.23.
The last time petrol was this expensive was on May 19, when average prices reached $60, just before the all-time high of $70 on May 12.
Because these are typical pricing, operations like token exchanging and smart contract activities are likely to be more expensive. A Uniswap token swap can currently cost as much as $30, according to Etherscan’s gas tracker.
According to Cryptofees, the Ethereum network generated $32.7 million in fees yesterday. This is 98 percent higher than Bitcoin’s in-network fees of $629K on August 26.
Record Month for NFT Sales
As the buzz builds again, nonfungible tokens are the source of the gas surge. According to Nonfungible, August will be the busiest month in terms of sales, with $900 million in sales already recorded in the previous 30 days.
OpenSea, the NFT marketplace, is currently the top gas guzzler, generating about $5.7 million in network fees in the last 24 hours. This amounts to over 21% of the total gas consumed on Ethereum in the previous day. According to Etherscan, Axie Infinity, which was newly listed on Coinbase, is also up there, having consumed $933K in gas in the last 24 hours.
Because of the high transaction fees, even NFT investors have begun to slow down.
Axie Infinity and CryptoPunks, according to Cryptoslam, have dominated NFT sales in the last 30 days, producing $850 million and $500 million, respectively. With $438 million in sales in the last month, Art Blocks are the third most popular.
Ethereum Price Retreating
Over the last 24 hours, the underlying asset price that drives all of this network activity has fallen by 1.7 percent. According to CoinGecko, Ethereum was trading at $3,108 at the time of publication.
The asset has recovered 35% in the last month but is still down 29% from its all-time high of $4,357 reached on May 12.
NFTmania to Decrease? Volumes of NFT Trades have Begun to Decrease
Although the volumes of NFT trading achieved tremendous heights in August, they decreased dramatically in September.
Investors appear to have drastically lessened their demand for non-fungible tokens, reaching all-time highs in August. Indeed, the NFT-based trade volumes at Ethereum did not exceed $100 million in the last three days, while in August, they exceeded $500 million for one day.
The Volumes of NFT Trade to the South
According to Alex Thorn, head of firmwide research at Galaxy Digital, a recent study has shown that daily volumes of non-food tokens have been falling steadily every day since the start of September.
For example, the NFT marketplace was about 300 million dollars on September 1 and 2; however, the marketplace was less than 100 million dollars after September 10. On the contrary, the trade volumes recorded successive all-time highs, exceeding $500 million daily on 29 August.
Talking of the amazing peak last month, OpenSea – a significant peer-to-peer marketplace that is not fungible – was an enormous milestone as its trading volume reached the 1 billion dollar mark.
Previously, the platform had a total transaction volume of about $100 million in 48 hours. Moreover, this figure was four times higher than that registered by the Open Sea during 2020.
However, the NFT industry has increased its popularity this year despite the fall in trading volume in September. Athletes, singers, entertainers, musicians, and other notable people who started their different digital arts became highly attractive.
Who Was Part of the NFT Craze
Some are particularly concerned with the mania that is not fungible among these renowned persons. For example, the famous quarterback Tom Brady is like this.
In April, the 43-year old, probably America’s most successful football player, said that his own NFT platform, Autograph, would be released. By doing that, Brady planned to bring together important names from diverse industries, such as sports, fashion, pop culture, and entertainment. They might produce individual digital pieces of art.
Since Naomi Osaka, Tiger Woods, and Tony Hawk joined the platform, his plan appears to have been tremendously successful.
Eminem, a hip-hop giant, also stepped onto the NFT bandwagon. After working with the digital art auction platform, Nifty Gateway, the 15-time Grammy winner, unveiled a collection of his own, dubbed Shady Con.
One of the latest examples of this is the American comic book powerhouse Marvel Entertainment. Firstly, in early August, the organization joined together to release Spider-Man NFTs with the blockchain digital collectibles market – VeVe. Shortly thereafter, new digital collections, including Captain America, Barnes’ Bocky, and Red Skull, were added to expand their not-fungible token universe.
China’s Official Media Slams the NFT Craze
Securities Times, a sister publication of the People’s Daily, issued an editorial piece criticizing non-fungible tokens as the hype and arguing that digital assets should serve the real economy by tokenizing actual assets.
The essay also stated that NFTs should benefit the real economy by tokenizing real-world assets such as real estate and automobiles.
Meanwhile, Chinese tech behemoths are capitalizing on the NFT market’s strong success. Last week, Alibaba’s online mall launched an NFT moon cake — a dessert to commemorate the Chinese traditional celebration Mid-Autumn Festival — and it sold out in one day. In addition, Alipay sold two batches of NFT artworks in June and August, totaling 160,000 pieces on the day of issue. Tencent’s NFT platform “Huanhe” was also introduced in August.
Despite this, Chinese technological behemoths have been the subject of antitrust investigations for nearly a year. Alibaba was fined 18.2 billion yuan (US$2.812 billion) in April after being accused of monopoly. In July, the Market Supervision and Administration agency issued 22 antitrust fines to technology companies, including Alibaba, Tencent, and Meituan. The Central Commission for Discipline Inspection, China’s anti-corruption watchdog, published an article on its website on Saturday headlined “Set Traffic Lights for Capital Expansion,” demonstrating the government’s antitrust determination.
Fees for Ethereum have Risen Dramatically
Yesterday, Ethereum’s average network fees increased by 300 percent, owing to the market’s fall and a hyped project’s minting event.
Fees on the Ethereum network have risen yet more. This time, it appears to have been triggered by two different factors: the market’s fall and the impending release of a new NFT collection.
Since May, Ethereum fees have been at an all-time high
The costs on Ethereum’s network have soared yet again, with a 300 percent spike in a single day. According to YCharts, they were at their highest position since late May yesterday.
On September 7th, the average costs for Ethereum were $21.29.
The entire community took notice, with many claiming that there are cheaper choices available from competing businesses.
What Caused the ETH Fees to Increase?
Two factors could be at the root of the exorbitant ETH expenses. The marketwide collapse that we saw yesterday seems to be the most obvious explanation right off the bat.
Over $2.5 billion in long and short positions were wiped out in just a few hours. This occurred as Bitcoin fell below $43,000 and Ethereum fell below $3,000.
Such events trigger panic sellers. People are flocking to exchanges, especially decentralized ones like Uniswap, to liquidate their holdings and avoid more losses. As a result, the number of requests for transactions rises, pushing up the ETH fees. It occurs whenever there is a sudden movement in any direction.
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