High gas fees remain the main pitfall of Ethereum, the largest and most widely adopted smart contract blockchain. However, after the deployment of the Merge, Vitalik Buterin, the Ethereum co-founder, disclosed that more updates would be released in the future to tackle the issue of high transaction fees on Ethereum.
While this upgrade including sharding is yet to come, it bears noting that gas fees on the Ethereum blockchain reached another yearly high on Friday. IntoTheBocks, a leading cryptocurrency market intelligence, and analytics platform dropped the update.
Per the update, the total fees on the Ethereum network surged to a massive $46.1 million on Friday, indicating an increase in the token demand and user activity on the blockchain network.
Notably, the low scalability design of the Ethereum network makes it incapable of handling numerous transactions per second. Hence, when there is a notable growth in the number of users initiating transactions per second on the proof-of-stake (PoS) network, fees to process it by the network validators tend to spike.
Therefore, the recent yearly high in gas fees recorded on the Ethereum network was triggered by the Blur airdrop rush and the ongoing free NFT mint connected to Coinbase’s layer-2 project, Base.
“Ethereum hit another yearly high in fees, mostly thanks to the Blur incentives and Coinbase’s free NFT mint. This surge in fees indicates a rise in demand and activity on the network,” IntoTheBlock wrote.
Ethereum hit another yearly high in fees, mostly thanks to the @blur_io incentives and #Coinbase's free NFT mint 🎨. This surge in fees indicates a rise in demand and activity on the network. #cryptocurrency #Ethereum $ETH $BLUR #Base pic.twitter.com/H8cAYKUuQq
— IntoTheBlock (@intotheblock) February 24, 2023
Coinbase NFT and Blur Airdrop Effect
Last Thursday, the largest United States-based crypto exchange launched an Ethereum Layer 2 blockchain network called ‘Base’ on the testnet. The Base is said to be a secure, cheap, developer-friendly solution for developers to build decentralized applications.
The catch of the testnet launch was the non-fungible token (NFT) collection released alongside Base. Interestingly, this NFT collection dubbed ‘Base, Introduced’, has been made available for free minting on the Ethereum network by anyone courtesy of Coinbase’s partnership with Zora, an NFT minting source.
But to successfully get a unit of the NFT, your wallet must hold at least 0.000777 ETH to pay as a gas fee.
Noteworthy is that one wallet is entitled to only one NFT. More so, the open-edition free mint of ‘Base,Introduced’ will end on February 27. At press time, 209,600 ‘Base, Introduced’ have been minted which justifies the increased activity and fees on the ETH network.
The tension to qualify for the season two BLUR token airdrop introduced by the NFT marketplace, Blur has equally contributed to the high activity seen on the Ethereum network. According to Blur, it would issue over 300 million BLUR tokens to loyal community members.