According to Decrypt yesterday, the mining community has increased the network capacity of Ethereum, allowing more transactions to be processed on the network. This is caused by a large increase in network traffic. The stable currency Tether and the gaming game Fair Win take up a lot of space in the Ethereum network.
Ethereum co-founder Vitalik Buterin said last week that due to network congestion, block producers have begun to increase the gas limit. In the Ethereum network, gas is an independent cryptocurrency that pays for transaction costs, while the gas limit actually controls how many transactions can be included in a block. This is similar to the blockchain capacity cap of Bitcoin.
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But in Ethereum, the gas restrictions are gradually changing. As the network gradually adapts to the current environment, according to current standards, each miner can increase the gas ceiling by 1/1024, thereby slowing down the increase and decrease of the gas ceiling.
Today, miners continue to raise the gas ceiling, causing the gas value of each block to exceed 10 million, an increase of 25% from last week. This means that each Ethereum block can now contain about 25% more transactions than the previous week.
This allows the Ethereum network to process more transactions per second, helping to reduce costs. However, this does mean that the blockchain capacity grows faster, making the running nodes more expensive and difficult to continue running the network.
What made the Ethereum block?
Tether seems to be the main reason for the growing Ethereum deal. In the past few months, this stable currency has moved from the Bitcoin network to Ethereum. This is a huge burden on the Ethereum network due to the large number of transactions being processed every day.
In an interview with the Canadian media the Star, Buterin pointed out that scalability is a major bottleneck because the Ethereum blockchain is almost full.
Earlier this month, it was reported that 25% of the Ethereum network transactions were from Tether.
But Tether is not the only currency that occupies the space of the Ethereum. The blockchain gambling game Fair Win has paid a total of $1.17 million in transaction fees over the past 30 days, indicating that the company has also generated a large number of transactions.
(The Ethereum transaction has gradually filled up the block, source: Coin Metrics)
According to intelligence provider Glassnode, decentralized financial (DeFi) applications are becoming more popular and putting pressure on the network. According to the report, about 45% of transactions are done through smart contracts – mainly from DeFi applications.
The problem worsened on September 20, when the daily transaction costs of Ethereum exceeded Bitcoin for the first time since March 2019. On the same day, Ethereum transaction costs were $207,000, while bitcoin was only $180,000. But hardcore fans at Ethereum think this is a good thing because it shows that the demand for the network is high.
Ethereum's increase in gas restrictions is considered a controversial move.
A Bitcoiner at Stanford Law School believes that raising the upper limit of the gas indicates that the network is central, he said, which shows the high control of the Ethereum miners on the network.
In response, ConsenSys scalability researcher John Adler responded that:
“Do you not know that the community has been discussing for several weeks and asked the miners to raise the gas limit?”
Another problem caused by raising the upper limit of gas is that it will result in more transactions per block in Ethereum. This means that the capacity of the blockchain will grow at a faster rate, and the Ethereum node will therefore be under greater pressure. Miners will have to pay more to buy equipment to get more storage. If the number of miners is reduced, this may lead to the gradual centralization of the network.
However, despite the slow growth of the network's capacity, the new Ethereum block has begun to hit a new ceiling, indicating that the gas cap needs to be raised again as soon as possible.