According to Ethereum blockchain explorer Etherscan, Ethereum gas prices more than doubled from Tuesday to Wednesday and are on track to double again Thursday.
Transfers using the addresses of centralized stablecoins, Tether and USDC, account for a large portion of the rise. Over the last 24 hours, Tether stablecoin transactions have accrued the most fees, surpassing deals on decentralized exchanges Uniswap and 1inch.
The above table shows avg gas cost in ETH network. From May 10, 2022 to May 12, 2022, The gas price has increased nearly 400%. Source: Ethereum price Tracker
This week, UST lost a significant amount of ground, falling as low as $0.1285. Terra’s native token, LUNA, fell from a monthly high of $99 to $0.0001 as a result of the depegging. As a result Binance Delisted Both LUNA & UST.
What is Ethereum Gas Fee??
The amount of Ether (ETH) required for an Ethereum blockchain network user to make a transaction on the network is referred to as a gas fee. Gas fees compensate Ethereum miners for their efforts in confirming transactions and safeguarding the network.
Yesterday, little under 22 billion USDT were exchanged on Ethereum, the most since May 2021. But it isn’t always because people want Tether. According to CoinMarketCap, USDT’s market capitalization has dropped by 2% in the previous 24 hours, implying that circulation has decreased.
While the falling value of ETH—now below $2,000 for the first time since July 2021—usually lowers transaction fees in dollar terms, the amount of activity on the network is actually driving up the price of gas in USD. On Thursday, the anticipated cost of a Tether (USDT) transfer exceeded $20.
Lending and borrowing platforms are also under a heavy “attack” as investors are rapidly losing trust in any of the top stablecoins or DeFi solutions and are moving money away from various liquidity contracts.
DeFi-related tokens such as AAVE, ADA, and ATOM are also tanking, losing more than 60% of their value in a couple of days. However, DeFi is not the only business that has seen a significant decline in netflow, as cryptocurrencies such as Bitcoin have also experienced double-digit losses in recent days.