The upcoming ice-age might have caused a sharp growth of commissions on the Ethereum network.- The liquidation of leveraged positions by DeFi applications may be another reason for the abnormal commissions.
Abnormally high commissions were registered in certain blocks of the Ethereum network in the end of the previous week. Sometimes the cost exceeded $30, and even $40, according to the crypto news media outlet Bitcoinist.
In particular, the publication cites Coin Metrics researcher Nate Madry, who drew attention to the fact that when trying to send a transaction, the recommended fee was more than $ 40. In other blocks, the commission exceeded $30.
The analyst also noted that recently the blocks in the Ethereum network have been almost completely filled.
The experts believe that there can be several reasons for such abnormal commissions. One of them is the recent increase in mining complexity associated with the function of the so-called “ice age”. Although its activation is expected to be delayed again, it takes longer to generate ETH blocks.
Another possible reason is decentralized finance (DeFi) applications. The Ethereum price dropped from $185 to $145 during the previous week, which resulted in the liquidation of leveraged positions. Apart from that, DeFi-related contracts might have been forced to pay higher commissions for timely executions.
Over 200 CDP liquidations happened in the last 24 hours. Our Automation system has kept 70+ CDPs on both SCD and MCD with over $3Million worth of collateral safe throughout the crash, a one-stop management solution for decentralized finance protocols DeFi Saver wrote on Twitter.
It is also possible that the launch of the ERC-271 token for the Gods Unchained collectibles market on Thursday had its toll as well.
Anyway, Tether remains the main consumer of resources on the Ethereum network. In the previous week, Glassnode service noted that USDT’s total transaction volume exceeded $100 billion, more than 6000% from the beginning of the year.
In general, the publication notes, compared to the peak values in May, when the load on the Ethereum blockchain at certain times exceeded 94%, now the network is used less actively – by an average of 84%.
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