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Date:
14th Jan 2021
Author:
CryptoAltum Research Team

Mark Cuban Complains about High Gas Fees in Ethereum

Mark Cuban, a crypto critic who would rather hold bananas than Bitcoin, is surprisingly taking a 180 and now complains about the high Gas fees in Ethereum and DeFi. In a follow-through tweet on Jan 12, the billionaire notes the high cost of transacting in DeFi, explaining that the "cost of moving crypto to AAVE is crazy expensive," and is an issue. In recent days, the average transaction cost in Ethereum spiked to $16 before falling back, averaging $5, a more than 5X increase since the stable Gas fees before the explosion of ETH prices.


Details: 

Ethereum is the pioneer smart contracting platform. In the medium term, it shall continue to enjoy this first-mover advantage, as related statistics show. There are more developers and dApps launching from the network than in any other "Ethereum killer." Because of this and the consensus algorithm deployed by its creators, the cost of transacting on the network is always on the rise as miners seek the best return from their investment. Because of rising Gas fees, Ethereum is drafting a temporary solution via Layer-2. However, this—together with Serenity, will eventually reduce Gas fees to reasonable levels making DeFi a more exciting experience, a suitable trigger to take the sub-sector mainstream, and attractive enough for billionaires like Mark Cuban to consider.


Impact on the ETH Price: 

Bullish. Once Gas fees (or simply transaction costs are slashed to negligible levels in coming years), Ethereum will be more wholesome. Complaints from Mark and potentially other billionaires with interest in crypto—and Ethereum, will be unheard of. For now, the rising Gas fees reflect the level of demand in Ethereum, a factor that also signals the status of ETH prices.


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