The Ethereum network gas fee spiked to a new multi-month high amid a growing memecoin frenzy. The high transaction fee has multiplied Ethereum’s daily revenue compared to Bitcoin (BTC). While Ethereum proponents welcomed the growth in revenue, many others were quick to point to the increasing congestion on the network and the difficulty in processing transactions.
There was an unusual turnaround in the top 10 gas-burning altcoins where, instead of ETH (ETH), WETH, and USDT (USDT), memecoins like TROLL, APED, and BOBO were among the top 10 burners.
⛽️ A very unusual change in the top 10 gas consumption #altcoins has emerged today. Rather $ETH, $WETHand $USDT being at the top of the fee distribution list, we are seeing new assets like $TROLL, $APEDand $BOBO among them. Read our latest deep dive. https://t.co/7SlmJ59k2m pic.twitter.com/Y2kaLKZTrL
— Santimento (@santimentfeed) April 19, 2023
The average gas price for Ethereum transactions as of April 20 was 81.94 gwei, up from 60.82 gwei on April 19 and 44.42 gwei last year, an increase of 34.74% since on April 19 and 84.46% from April 20, 2022. Gwei is a denomination of ether and represents one billionth of an ETH.
Freelance Ethereum Educator Anthony Sassano shared the increase in daily fee revenue from the Ethereum network and said that the second largest blockchain had generated 28 times the revenue of Bitcoin. He also cited Ethereum layer 2 platforms like Arbitrum One, which have outperformed the BTC network in terms of daily revenue due to the ongoing meme frenzy.
The main argument of the Ethereum proponent is that the high gas fee and subsequent higher revenues highlight the increasing usability of the network. However, many on Crypto Twitter were quick to point out that the extensive use they are referring to is only a few thousand users staking on memecoins.
The extensive use you’re talking about is a few thousand users staking meme coins. I thought (and hoped) that eth was supposed to be the future of finance
– snap. Basically risk free (@CryptoPannella) April 20, 2023
Some users reportedly paid gas fees as high as a few hundred dollars, while others complained of having to pay a higher gas fee than the actual transaction.
try buying an NFT of ~$20 worth of eth, and gas is ~$40.
some people say that infrastructure operators deserve to be paid. sure, but the image pays a $40 visa fee to buy a $20 digital good… the infrastructure should be affordable. pic.twitter.com/5L4SYjT5af—0xMQQ (@0xMQQ) April 18, 2023
Another major reason for the rise in gas fees was attributed to a maximum withdrawable value (MEV) trading bot that is at the forefront of large-scale memecoin trading. The bot in question, jaredfromsubway.eth, has been the biggest gas spender in the last 24 hours, spending 455 ETH ($950,000) and using 7% of the network’s total gas.
Related: Tether blacklists address of validator that depleted MEV bots for $25 million
In the last two months, he spent more than 3,720 ETH ($7 million) on gas fees and made more than 180,000 transactions.
brother has used 7% of the total gas in ethereum for the last 24 hours (455 ETH) just feasting $pepe
legendary data @hildobby_ https://t.co/j3SqtQnkKJ pic.twitter.com/hWavtdO1D5
– beetle (@1kbeetlejuice) April 18, 2023
The Subway-themed bot is using the sandwich trading technique to pocket millions of dollars while congesting the network at the same time.
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