Binance Smart Chain Flips Ethereum in Daily Transactions; PancakeSwap Trumps Sushiswap
Insane high fees on Ethereum are making other blockchains attractive to users, especially the smaller ones.
The crazy high fees on Ethereum are very well-known and a cause of headache for many users on the second largest network, especially for smaller users.
The average fees on Ethereum have been going up ever since the summer of 2020 when decentralized finance (DeFi) space exploded into the scene, and everyone wanted to be in on the yield farming action.
The fees normalized by the end of November but only temporarily, and we are back to seeing increased amounts of fees almost every other day, though we are yet to see the September DeFi peak levels.
Average fees are still keeping above 0.01 ETH, which gets higher when transacting on DeFi protocols and to get them processed faster.
“Leading cause of insane gas prices: The absurd amount of arbitrage opportunities created by competing liquidity mining AMMs. Users don't always win with limited block space and gas fees higher than slippage + user fees combined,” noted Hayden Adams, the creator of leading DEX Uniswap.
All of this high fee on the Ethereum network has made other blockchains attractive to users, which is now resulting in Binance Smart Chain getting increasing traction, so much so that it even surpassed Ethereum at one point.
“Today is an important day. BSC (#BinanceSmartChain) flipped Ethereum on daily transactions,” announced Binance CEO Changpeng Zhao.
“This validates the logic that low fees attracts more users & projects. We will continue to work with the BSC community to promote low fees (even as BNB rises) and build more.”
When the gas fees are too high, it becomes a network for the rich. (it wasn't designed/intended that way, but… that's economics)#BSC is for the little guys. And there is a lot of us. https://t.co/2ShpSxCkDF
— CZ 🔶 Binance (@cz_binance) February 8, 2021
Other projects are taking the insane fees on Ethereum as an opportunity to advertise themselves and gain adoption before ETH 2.0 actually ships, which is expected to take years.
However, it’s to be seen if this trend will continue or if it’s just a blip. SushiSwap is the second biggest DEX in terms of volume, which has over 24% of the market share. Uniswap, meanwhile, is the leader in the decentralized exchange space, which registers more than double the SuhsiSwap’s volume, above $1 billion daily, capturing a dominant 51.4% market share.