“Ethereum Gas Fee”, which is the lifeblood of the Ethereum ecosystem, is used to calculate the amount of fees that need to be paid to the network in order to perform a certain transaction.
Although we are still in the middle of 2020, the Ethereum blockchain is preparing to set a new annual gas payment record.
According to the statement by Wilson Withiam, a researcher at the crypto analytics platform Messari, given the gas record in 2018, gas payments are currently only 2,000 ETH lower. Given all this, 2020 will be a new record year.
Increasing popularity of decentralized finance (DeFi), as well as increased use of Tether (USDT), is considered the main reason for the increase in ETH gas fee. The ETH-based DeFi market has increased from $ 2 billion to $ 3 billion in the past three weeks.
In particular, Tether currently accounts for 78% of the market share of all ETH-based stabilcoins. With its increasing popularity, USDT rose to the third biggest cryptocurrency position in terms of market value and dropped Ripple (XRP) from its throne.
Increasing the usage rate of the Ethereum network, the increase in gas causes high transaction fees, which are considered as a potential barrier for smaller capacity users. With the upcoming Ethereum 2.0 update, it is planned to reduce transaction fees.