Migrating From Ethereum To BSC
The reason for this shift could be attributed to the desire to escape high gas fees associated with executing transactions on public ledgers like Ethereum and BSC. In Ethereum, gas fees remain higher, especially for users deploying smart contractsSponsored Product.
An analysis of the latest gas fee trends on Etherscan indicates that network fees have been fluctuating and generally higher in recent weeks. As of May 17th, Gas fees stood at 43 gwei or roughly $1.59 for simple transfers.
In contrast, BscScan data shows that users only need to pay 3 gwei for transfers regardless of transaction urgency.
The difference in gas fees between Ethereum and BSC when analyzed in USD terms is apparent and could explain why users are seeking alternatives by moving their assets from Ethereum to alternative blockchains like BSC that offer lower Gas fees.
Is PEPE FOMO The Reason?
The recent surge in Ethereum gas fees can be attributed partly due to hype surrounding PEPE – a meme token. With PEPE spurring demand and forcing on-chain activity higher, it caused an increase in Ethereum’s gas prices as well. According to Y-Charts, Gas Fees increased from $43 on April 22nd up until May 5th where they peaked at $155 per transaction.
This spike highlighted scalability challenges faced by ethereum during periods of increased activity; fluctuating Gas Fees depending on network activity being one primary reason developers look towards long-lasting solutions such as integrating both off-chain scaling methods alongside traditional blockchain technology itself through ideas such as Sharding which breaks down networks into sub-networks called “shards” that process transactions independently while remaining connected to other shards.
Layer-2 scaling optionsSponsored Product are also gaining traction as a means of improving scalability by re-routing transactions to an off-chain platform, relieving the underlying blockchain and reducing processing fees.
L2Beat currently shows over 20 layer-2 scaling options aiming to scale the mainnet with Arbitrum and Optimism being two of the most active general-purpose platforms for deploying smart contractsSponsored Product and decentralized applications controlling over $7.5 billion in assets measured by total value locked (TVL).
The Future Of Ethereum
Ethereum’s roadmap includes introducing Sharding where networks will be broken down into portions called “shards”. Each shard processes transactions independently but remains connected to others forming part of the whole Ethereum blockchain system which hopes to scale transaction processing throughput on-chain lowering fees; however, this is still just an idea under study.
In conclusion, it seems clear that users are seeking alternatives due to high gas prices associated with executing transactions on public ledgers like Ethereum or BSC. Developers have been looking towards long-lasting solutions such as integrating both off-chain scaling methods alongside traditional blockchain technology itself through ideas such as Sharding breaking down networks into sub-networks called “shards”. Layer-2 scaling options are also gaining traction as a means of improving scalability by re-routing transactions to an off-chain platform, relieving the underlying blockchain and reducing processing fees.
Optimism will release “bedrock,” via a hard fork in early June 2023. This upgrade aims to enhance scalability, improve transaction speeds, and reduce gas fees on the off-chain solution. With these improvements, Optimism hopes to carve out a larger market share pushing its TVL higher.
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