Ethereum transaction fees are higher than Bitcoin for two consecutive months, and Ethereum improvement proposals are struggling
Ethereum (ETH) transaction fees have exceeded the transaction fees on the Bitcoin (BTC) network for two consecutive months.
Encrypted market data aggregator Messari pointed out on Twitter on October 8th that this is the longest time that Ethereum’s transaction fee income has exceeded Bitcoin in history.
Ethereum fees have been higher than Bitcoin fees for two consecutive months. This is the longest time ever.
——Messari (MessariCrypto) October 8, 2020
As the Decentralized Finance (DeFi) bubble began to enter a stage of rapid development, Ethereum fees soared to a record high in August. Smart contracts that support the DeFi protocol usually need to execute multiple Ethereum transactions, which intensifies the congestion of the Ethereum network.
The average cost of Ethereum is currently about $2, which is lower than the all-time high of $14 in September.
The soaring transaction costs have reignited a heated debate within the Ethereum community on how the Ethereum network should adapt to network congestion during the transition period before the launch of ETH 2.0. ETH 2.0 is currently expected to be launched in 2022.
On October 8, ConsenSys developer Tim Beiko announced the results of a survey that assessed the views of 25 teams built on top of Ethereum on the Ethereum Improvement Proposal (EIP)-1559.
The EIP-1559 proposal improves Ethereum’s fee market by adopting a fixed-rate network fee for each block, including tips for miners. When a block is created, a portion of the fee will be consumed according to the degree of congestion.
Among those surveyed, 60% support EIP-1559, of which about 13% expressed negative views, and 27% expressed neutrality. These teams include exchanges, wallets, on-chain applications and miners. Developers reacted well to EIP-1559’s gas price predictability and destruction mechanism. Beiko reports:
“The main benefit of projects seeing EIP-1559 is the predictability of gas prices, especially those projects that set prices for users, and the fact that ETH is consumed in every transaction.”
However, the doubts about EIP-1559 include the possible impact on miners’ income, some concerns about its implementation, and the lack of formal specifications for the EIP-1559 proposal.
Unsurprisingly, 8 of the 9 mining companies that were asked claimed that if EIP-1559 was introduced as a hard fork, they would refuse to accept it.
