Understanding Ethereum transaction fees: 20% normal?
As the second largest cryptocurrency after Bitcoin is market capitalization, Ethereum has become a popular choice for individuals who make microtransets and deal with manufacturers. However, one of the questions that has confused many users is that the average transaction fee for Ethereum is around 20%. In this article, we are immersed in the reasons for the awards and reveal what they consider normal.
What are the transaction fees?
Transaction fees are a small amount of cryptocurrency that is charged by the network to process transactions. Developers are encouraged to build and maintain the Ethereum network, which allows for smart contracts and decentralized applications (Dapps). The fee is usually paid in the form of ether (ETH), the native cryptocurrency of the Ethereum network.
Why are transaction fees high?
The main reason for the transaction fees on Ethereum is high:
- Network congestion : With more than 200,000 active accounts, the Ethereum network can congestion, resulting in increased processing times and higher charges.
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- Gas prices : The gas is the measurement unit of the transaction costs of Ethereum network. As the gas prices continue to rise, the transaction fees.
Normal charge 20%?
۲۰% of today’s competitive cryptocurrency market may seem relatively high compared to other platforms. However, the following factors are essential:
- Volume of Transaction
: If you carry out frequent transactions, the fees may be higher due to increased network congestion and demand for computing resources.
- Network Capacity : The Ethereum network has a limited capacity, which can result in higher fees if the network is fully used.
- Market Competition
: Other platforms such as Binance Smart Chain (BSC) or Polygon offer lower transaction fees for Ethereum.
However, many users consider it relatively high. By comparison:
- For Bitcoin Cash (BCH), the average transaction fee for popular Altcoin is about 1-2 cents.
- On Cardano (ADA), the average transaction fee on another blockchain platform is significantly lower, about 0.01-0.05 ETH.
Conclusion
Although 20% may seem relatively high in Ethereum, it is essential to take into account the capacity and market competition of the network when deciding that this fee is reasonable for your needs. As the cryptocurrency landscape develops further, we can expect fees to be reduced as the network is increasingly used.
Currently, if you are a frequent micro-organ or regularly use Ethereum Dapps, it is worth paying for 20%. However, if an easy user with rare transactions, it can be 1-2 cents more reasonable per transaction. Finally, it is essential to consider the costs and benefits of using Ethereum before drawing any conclusions.
References:
- Coindesk.com: “Ethereum transaction fees, since in some areas the $ 5,000 is the highest fees”
- Cointelegraph.com: “Why does the Ethereum transaction fee reach record heights?”
- Ethereum.org: “Understanding Ethereum Transaction Fee”
