The recent high ETH fees associated with the DeFi boom has been a subject of controversial discussions in previous weeks.
According to data analysis, the DeFi sector presently holds funds worth nothing less than $6.21 billion in various stablecoins.
Currently, Maker (MKR) is leading five other markets as they have a value of around $5 billion locked down. With most of the projects developed in the Ethereum blockchain, the popularity and the patronage enjoyed by the project have resulted in high ETH fees.
According to a survey by the data analysis website, Coinmetrics, the recent increase in the ETH gas fee has sacked most retailers, leaving the platforms to the whales.
High ETH fees result from the increase in daily transactions, CoinMetric reports
CoinMetrics reported the issue in their latest document titled “State of the network”, where they gave insights into how the high ETH fees came about.
According to the firm, Ethereum witnessed a total daily volume of $6.87 million on August 12, a significant groundbreaker. It displaced the previous daily volume all-time high figure of $4.55 million.
On August 13, Ethereum witnessed another record-breaking feat as it saw a daily transaction volume of $8.61 million to set yet another daily volume. Furthermore, the report claims that the increase in ETH fees as a result of the transaction carried out on the platforms.
Small scale traders on DeFi platforms priced out
With the high ETH fees, most small-scale users on the platforms complained serially of being locked out of the platforms. Presently, it looks like only whales can afford increasing ETH fees.
The main reason the transaction fees are on the rise is because of the increase in the demand by traders for their transactions to be confirmed on time.
As a result of traders paying high fees for transactions, miners, in turn, reap bountiful profits in the process. The major disadvantage of the high ETH fees is that most of the DeFi sector small-scale users are always kicked out in the end.
