During the last few weeks, the Ethereum market has been a protagonist in the crypto world. As decentralized finance attracts more and more capital, a good part of these investments end up in the Ethereum’s Blockchain, specialized in the creation of smart contracts. Thanks to this, those who participate in the crypto-currency network are going through a period of high profits. It is known that Ethereum’s mining generates $800,000 per hour in commissions alone.
Are Crypto Whales betting on the DeFi?
Decentralized Finance and Ethereum
Since the birth of the Ethereum, the Blockchain of the cryptomoney was designed with the objective of allowing the greatest number of decentralized projects for its users. Thus, instead of seeking to be a replacement for fiat money as Bitcoin. The Ethereum chain allows the creation of decentralized applications and smart contracts by the users of the crypto community.
Thanks to this, the Ethereum chain has been widely used by decentralized finance projects. They take advantage of this capacity of the ETH network to design their own tokens and smart contracts, without the need to create a Blockchain from scratch. It is much more efficient to simply use ETH’s platform by paying a commission.
Therefore, during these months when the DeFi market has experienced a boom with an exponential increase in its capitalization. It is normal that the demand for Ethereum, the currency used in most DeFi transactions, also increases. Especially for the payment of commissions for the use of your network by these DeFi projects. Being this the main source of income from Ethereum mining at present.
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Commissions in ETH mining
The increase in the demand for Ethereum has logically led to an increase in transactions with cryptomoney. This has driven the increase in commissions within its Blockchain. Up to the point where you can pay tens of dollars in ETH for making a transaction using virtual currency.
Thanks to this, Ethereum mining has now become a very profitable business. According to Glassnode, $800,000 is generated every hour just by commissions for miners. Reaching an incredible $16.5 million per day from commissions for Ethereum mining alone. Compared to the 1.5 million generated in commissions within the Bitcoin Trader Blockchain. This is not counting the profits generated by the mining of ETH tokens.
This situation has already generated problems for users and companies. With the exchanges reporting losses of between 10 and 20 dollars for each Ethereum withdrawal from their platforms. This shows the limitations of the crypto currencies when the scalability problem has not been solved.