In August alone, miners made $113 million in profit, up more than 3,660% from the $3 million earned in April. Compared with the average transaction cost of just $0.09 in April, current ethereum fees remain excessively high, even with the latest decline.
Per the Glassnode data, the absolute number of transactions on the Ethereum blockchain fell nearly 30% to 935,000 on October 4, down from a 2020 high of 1.32 million three weeks earlier.
Analysts blame the spike in ethereum transaction costs on the hype within the decentralized finance space, which has grown into a $9 billion industry in just three months. In July, over $2 billion of value was locked in the entire defi market, data from Defipulse shows.
And as defi protocols such as uniswap (UNI), compound (COMP), yearn.finance (YFI), curve.finance (CRV) and balancer (BAL) competed for block space to get transactions processed through the Ethereum network, fees rocketed.
According to Etherscan, protocols such as Uniswap is one of a few with the highest network utilization. Tether (USDT), sushiswap, and YFI are the others. Now, the hype appears to have cooled off somewhat, with major defi products falling by between 30% and 45% in the last week.
ETH developers have also been testing technical solutions to reduce costs and improve efficiency, including a network upgrade dubbed Ethereum 2.0. But the project is still several months away from coming to fruition.
What do you think about the falling ether transaction fees? Let us know in the comments section below.
The post Ethereum Transaction Fees Fall 82%, as Defi Hype Eases appeared first on Bitcoin News.
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