Over the past 24-hours, there have been several users complaining about the ridiculously high gas fees on the Ethereum network. Although the gas fees have once again fallen to an average of 48 gwei, yesterday it skyrocketed to 8122 gwei. This was due to the launch of the sale of Yuga Labs’ Otherdeed nonfungible tokens that represented digital land deeds on its Otherside Metaverse.
The creator of Bored Ape Yacht Club [BAYC], Yuga Labs took note of the situation as soon as the NFT mint was over and apologized for the inconvenience. The creators also highlighted the need for ApeCoin to migrate to its own chain to scale and asked the DAO to start thinking in this direction.
The congestion on the Ethereum network caused many users’ transactions to fail but they were promised a refund.
To put things in perspective, one user purchased a $25 NFT on Saturday evening but paid a total of $3,325. Why? Because the gas fee was $3,300.
Many such users who were able to successfully purchase their desired NFTs, were paying exuberant sums in gas fees. Now, gas fees are important to compensate Ethereum miners for verifying transactions on the blockchain. At busy times like yesterday, the gas fees can bundle up as many users also pay a higher amount to prioritize their transactions. This can overwhelm the Ethereum network due to which even certain transactions failed to go through causing the users to lose money and time.
Per data compiled by Glassnode and Data Always, close to 70,000 ETH was burned on 1st May, triple that of the previous ATH of around 20,000 in January. While the implementation of EIP 1559 brought the average burn rate to 5.81 ETH per minute, the NFT sale pushed this value to 9.83 ETH per minute for a total of 99,084.65 ETH over the past seven days. Nevertheless, at press time, the burn rate has been reduced to 3.48 ETH/min, as per data provided by Ultrasound.money.
It shall also be noted that Otherdeed NFT sale was at the top of the “burn leaderboard” over the past seven days with 55,827.44 ETH or 56% of all burns. OpenSea took second place with a large gap and recorded a burn of 7,173.16 ETH.
It is clear that the Ethereum network has been unable to manage heavy traffic due to the population of popular projects on its network. As Ethereum looks forward to the merge, several projects like ApeCoin will want to focus on developing their own blockchain- which will not only free up space on the Ethereum network but also take away users.