Coinmetrics has tweeted a monitoring data that showed that the average transaction fees for Ethereum had temporarily surpassed that of Bitcoin for the first time since their inception. This has compounded an apparent lack of confidence in Ethereum’s users this week.
While the Ethereum transaction fees remained below $1 since January, July has seen the platform embrace numerous shambles. It is being believed around the world that a Chinese exchange might be solely responsible for the price hike. The exchange was accused of using a highly consumptive voting process that stimulated an Ethereum-wide bottleneck.
At one point, an Ethereum transaction cost around $5 compared to Bitcoin’s $0.75, that is, nearly seven times. The increasing fees of more than 2350% created a fuss among the platform’s users.
One such user tweeted :
“Imagine paying 90 times more in transaction fees. If we cannot provide a single stable blockchain for DApps at $400 Billion markets, are we doing anything at all?”
However, the congestion appeared to be short-lived as the transaction fee dropped below the $1 mark on July 8th.
ETH/USD was trading at roughly around $500 on Wednesday and showed roughly 5% daily gains compared to Bitcoin’s 10%. The recent decline is pointing towards the exhaustion of the same speculation that drove it to new heights last year. ETH benefitted from the initial exuberance, but it might suffer as the market sobers.
On the other hand, Bitcoin has become considerably more attractive as a ‘currency’ to users this year. The uptake of SegWit technology has allowed fee rates to fall significantly often posting just 1 satoshi per byte. While Ethereum is suffering through clogs of spam transactions – which Bitcoin suffered from previously – pushing up miners fees significantly.
It is now being believed that ETH’s price is still very overvalued; still significantly overvalued from the network’s current and near-future technological state. Maybe the market technology is too immature to match current valuations. This lack of confidence in users must push Buterin’s troops to do something worth the time.