Ethereum is 'killing itself,' costing users thousands of dollars for every transaction
- Ethereum has settled over $6.2 trillion worth of transactions over the past 12 months, despite a spike in gas fees.
- Analysts argue that Vitalik Buterin once stated that "the internet of money should not cost 5 cents a transaction."
- Ethereum-killers like Avalanche, Solana and Cardano are likely to takeover the altcoin in the months before "The Merge."
Ethereum is expected to transition to proof-of-stake (POS) in late 2021 or early 2022. Until then, traders fight the uphill battle of rising transaction fees.
Avalanche, Solana and Cardano became popular as Ethereum-killers, but the altcoin is killing itself
Ethereum is months away from its transition to PoS, in “The Merge.” Until then, traders on the Ethereum network suffer from high fees on the network. Proponents on Twitter condone the complaints on transaction fees, however analysts consider this more than a rant.
A cryptocurrency trader @HukAleksandra tweeted earlier today,
Trying to do a transaction on #ETH blockchain atm, the cost is over a thousand dollars.
— Aleksandra Huk (@HukAleksandra) October 6, 2021
Vitalik once said “the internet of money should not cost 5 cents a transaction”.
Dunno what’s with “Ethereum killers” narration, sorry but Ethereum is killing itself.
Aleksandra is referring to Ethereum co-founder Vitalik Buterin’s statement,
The Internet of Money should not cost 5 cents per transaction.
Buterin has proposed the use of rollups for low transaction costs in the past. Though rollups may solve the altcoin’s scalability problem, they increase the reliance on others.
Decentralization is at the core of the Ethereum network. Rollups literally “roll up” transactions into a single block and reduce the congestion in the ETH network by centralizing it to a certain extent.
The price that traders pay for faster and cheaper transactions is a “certain degree of centralization” in the process.
The debate on fees continues since the Ethereum network has processed over $6.2 trillion worth of transactions over the past year.
Ethereum transactions settled over the past twelve months.
Alongside these developments on the Ethereum network, alternatives like Avalanche, Solana and Cardano have noted a spike in demand and market capitalization. Popular as Ethereum-killers, these cryptocurrencies have emerged as cheaper and faster alternatives to the Ethereum networks and thousands of decentralized applications have chosen AVAX, SOL or ADA ecosystem to develop their projects.
Until “The Merge,” Ethereum holders and traders are expected to suffer from high transaction fees on the network.
FXStreet analysts have evaluated ETH price trend and predicted that the altcoin has positioned itself for a bullish breakout.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
