The launch of UNI, the governance token of Uniswap DEX, is having a big impact on the Ethereum network. The good thing is the price of Ether spiked to $393 today and is currently trading above $385. But it also resulted in congesting the network even more as a new all-time high of 1.32 million transactions were recorded on it.
— Wolf (@IamCryptoWolf) September 18, 2020
Uniswap mania is making the network unusable as it puts further upward pressure on the already elevated fees, which had miners’ combined revenue set a new record, $938,000 in one hour yesterday. Denis Vinokourov of prime broker Bequant noted,
“As such, while the smaller and less efficient market participants may be struggling, the larger firms that are able to capitalise on inefficiencies and as indicated earlier, miners are making the most of the latest surge.”
— Alex (@classicmacro) September 17, 2020
In the light of increasing fees, Coinbase Pro also announced that from now, it would “pass along network fees directly to our customers.”
The gas fees that are paid directly to crypto miners to process transactions and secure the network has been historically absorbed by the exchange itself on behalf of its customers.
But “as crypto has begun to gain broader adoption in applications like DeFi, payments and other projects, networks have gotten busier,” which means longer wait times and higher fees “as users compete to get their transactions confirmed faster.”
Although the exchange does not change network fees for crypto transfers from one Coinbase account to another and Coinbase pro account still has no fee, “Coinbase Pro will charge a fee based on our estimate of the network transaction fees that we anticipate paying for each transaction,” it said.