How Long Before Ethereum Fees Get Lower? 1

How Long Before Ethereum Fees Get Lower?

Cryptocurrency
Crypto Industry
• Digitex
April 5, 2021

Ethereum has been grabbing the headlines a lot lately. From the rising popularity of DeFi and NFTs to being Visa’s blockchain of choice for settling its first transaction, ETH price has been on the up, recently marking its latest all-time high of over $2,100. All this action surrounding the premier altcoin has undoubtedly been bullish for HODLers and yield farmers. But, what about regular users trying to interact with the Ethereum blockchain? 

Rising gas fees on the network have been pricing them out of the market. According to  BitInfoCharts, this time last year, the average transaction fee on the Ethereum network was around 8 cents. Today, users are facing regular averages of around $20 just to move funds, calling the promise of low fees and near-instant transfers of value into question. And for traders looking to avoid the volatility of cryptocurrencies by using stablecoins, such as the ERC20 versions of USDT or USDC on Ethereum, high fees create a barrier.

In tandem with rising fees comes rising network congestion. Not only do users have to pay prices on a par with PayPal to move their funds but they also have to wait for lengthy periods of time to do so. While the solution to all these problems is touted to be the long-awaited transition to a Proof of Stake blockchain (ETH 2.0), that could be a long time coming. So, how long will users really have to wait before Ethereum fees get lower?

Optimistic Rollups

Ethereum users cannot wait for years to resolve the problem of high fees as DeFi grows and Ethereum attracts increasing attention from investors. Interim solutions are needed in the meantime. Even Vitalik Buterin recognized that Ethereum scaling was a top priority  and that a solution in the shape of optimistic rollups was on the cards very soon.

How Long Before Ethereum Fees Get Lower? 2

If you think of the blockchain in layers, Ethereum is a layer 1 protocol, whereas rollups are a layer 2 solution that aggregate transactions and store them inside smart contracts to reduce congestion on the network and bring gas fees down.  

The concept of rollups was first described way back in 2014, but they were referred to as “shadow chains.” And now that network congestion and fees have been thrust into the limelight once more, their utility is back on the table. How long will it take for them to be implemented? Some projects such as Polygon (formerly Matic) have already started using them with success and, optimistically (groan), rollups could act as the mid-term solution for Ethereum.

Berlin Hard Fork

Another solution for gas fees may lie in the upcoming Berlin Hard Fork, slated to take place on April 14, 2021. Months in the planning, however, it’s not certain just how much of a dent the hard fork will make in gas fees or whether it will improve congestion. Four main improvement protocols (EIPs) will be deployed in Berlin to make the network more robust and hacker-resistant, as well as tackling gas fees. 

But different analysts have questioned how much of an effect the Berlin hard fork will really have on gas fees, citing that Ethereum has deep structural changes that need to be resolved for it to scale first before sustainable gas fees are achieved. 

Competing Blockchains

In the meantime, cryptocurrency industry participants are not sitting idle. Several PoS smart contract blockchains from Solana to Algorand have already started rolling out solutions to help traders avoid Ethereum’s high gas fees.

By running stablecoins like USDC and USDT on these blockchains, traders can move their funds from a crypto like BTC or ETH into a stablecoin almost instantly and for a cost of next to nothing. This is particularly appealing to high-frequency traders and users who simply want to move small-to-modest amounts of value without paying exorbitant fees.

There is also an increasing number of blockchains integrating EVM compatibility. This allows any smart contract deployed on the Ethereum blockchain to be deployed on them. dApp developers being priced out of the market by high fees can easily migrate their dApps to one of these blockchains and continue to develop without the high cost.

However, most of these come with trade-offs and are arguably centralized or flawed in some form or another. Moreover, network effect isn’t something that you simply knock out of the park straight away. Ethereum has much longer time in the market and still far and away the largest developer community, and number of dApps in the cryptosphere. It’s also the backbone of the majority of DeFi projects and is well-recognized now among a growing class of institutional investors.

Closing Thoughts

The upcoming Berlin hard fork could give network users some temporary relief as far as high gas fees go and optimistic rollups seem to be the next likely major step forward for Ethereum before it transitions to ETH 2.0. 

With a little bit of luck, we might expect to see lower gas fees on Ethereum by the middle of this month and at least sustainable rates coming soon while we wait for ETH 2.0. In the meantime, Ethereum will certainly be keeping its eyes open to the cohort of high throughput blockchains that are springing up around it promising faster transactions and lower costs. 

Want to trade ETH futures with zero commissions on crypto’s only trading ladder interface? Sign up for a KYC-free account and start making gains now.

April 5, 2021
Cryptocurrency
Crypto Industry

How Long Before Ethereum Fees Get Lower?

Digitex
How Long Before Ethereum Fees Get Lower? 3

Ethereum has been grabbing the headlines a lot lately. From the rising popularity of DeFi and NFTs to being Visa’s blockchain of choice for settling its first transaction, ETH price has been on the up, recently marking its latest all-time high of over $2,100. All this action surrounding the premier altcoin has undoubtedly been bullish for HODLers and yield farmers. But, what about regular users trying to interact with the Ethereum blockchain? 

Rising gas fees on the network have been pricing them out of the market. According to  BitInfoCharts, this time last year, the average transaction fee on the Ethereum network was around 8 cents. Today, users are facing regular averages of around $20 just to move funds, calling the promise of low fees and near-instant transfers of value into question. And for traders looking to avoid the volatility of cryptocurrencies by using stablecoins, such as the ERC20 versions of USDT or USDC on Ethereum, high fees create a barrier.

In tandem with rising fees comes rising network congestion. Not only do users have to pay prices on a par with PayPal to move their funds but they also have to wait for lengthy periods of time to do so. While the solution to all these problems is touted to be the long-awaited transition to a Proof of Stake blockchain (ETH 2.0), that could be a long time coming. So, how long will users really have to wait before Ethereum fees get lower?

Optimistic Rollups

Ethereum users cannot wait for years to resolve the problem of high fees as DeFi grows and Ethereum attracts increasing attention from investors. Interim solutions are needed in the meantime. Even Vitalik Buterin recognized that Ethereum scaling was a top priority  and that a solution in the shape of optimistic rollups was on the cards very soon.

How Long Before Ethereum Fees Get Lower? 4

If you think of the blockchain in layers, Ethereum is a layer 1 protocol, whereas rollups are a layer 2 solution that aggregate transactions and store them inside smart contracts to reduce congestion on the network and bring gas fees down.  

The concept of rollups was first described way back in 2014, but they were referred to as “shadow chains.” And now that network congestion and fees have been thrust into the limelight once more, their utility is back on the table. How long will it take for them to be implemented? Some projects such as Polygon (formerly Matic) have already started using them with success and, optimistically (groan), rollups could act as the mid-term solution for Ethereum.

Berlin Hard Fork

Another solution for gas fees may lie in the upcoming Berlin Hard Fork, slated to take place on April 14, 2021. Months in the planning, however, it’s not certain just how much of a dent the hard fork will make in gas fees or whether it will improve congestion. Four main improvement protocols (EIPs) will be deployed in Berlin to make the network more robust and hacker-resistant, as well as tackling gas fees. 

But different analysts have questioned how much of an effect the Berlin hard fork will really have on gas fees, citing that Ethereum has deep structural changes that need to be resolved for it to scale first before sustainable gas fees are achieved. 

Competing Blockchains

In the meantime, cryptocurrency industry participants are not sitting idle. Several PoS smart contract blockchains from Solana to Algorand have already started rolling out solutions to help traders avoid Ethereum’s high gas fees.

By running stablecoins like USDC and USDT on these blockchains, traders can move their funds from a crypto like BTC or ETH into a stablecoin almost instantly and for a cost of next to nothing. This is particularly appealing to high-frequency traders and users who simply want to move small-to-modest amounts of value without paying exorbitant fees.

There is also an increasing number of blockchains integrating EVM compatibility. This allows any smart contract deployed on the Ethereum blockchain to be deployed on them. dApp developers being priced out of the market by high fees can easily migrate their dApps to one of these blockchains and continue to develop without the high cost.

However, most of these come with trade-offs and are arguably centralized or flawed in some form or another. Moreover, network effect isn’t something that you simply knock out of the park straight away. Ethereum has much longer time in the market and still far and away the largest developer community, and number of dApps in the cryptosphere. It’s also the backbone of the majority of DeFi projects and is well-recognized now among a growing class of institutional investors.

Closing Thoughts

The upcoming Berlin hard fork could give network users some temporary relief as far as high gas fees go and optimistic rollups seem to be the next likely major step forward for Ethereum before it transitions to ETH 2.0. 

With a little bit of luck, we might expect to see lower gas fees on Ethereum by the middle of this month and at least sustainable rates coming soon while we wait for ETH 2.0. In the meantime, Ethereum will certainly be keeping its eyes open to the cohort of high throughput blockchains that are springing up around it promising faster transactions and lower costs. 

Want to trade ETH futures with zero commissions on crypto’s only trading ladder interface? Sign up for a KYC-free account and start making gains now.

Latest News

What Are the Pros and Cons of Altcoin Trading? 5

What Are the Pros and Cons of Altcoin Trading?

Cryptocurrency
• Digitex
March 12, 2021

In 2009 when the anonymous Satoshi Nakamoto launched Bitcoin, BTC ruled the market for a few years as the only cryptocurrency.

Later on, crypto projects launched their own altcoins, offering alternative digital asset solutions to users.

While Bitcoin remained the top cryptocurrency, altcoins possess over 44% share in the industry with a combined market cap of $843 billion.

What Are the Pros and Cons of Altcoin Trading? 6

But what are alternative cryptocurrencies, how are they different from Bitcoin, and what are the pros and cons of altcoins for traders?

What Are Altcoins and How Do They Differ From Bitcoin?

Altcoins or alternative cryptocurrencies refer to coins other than Bitcoin. For that reason, all digital assets launching after BTC are considered altcoins.

While Bitcoin is generally viewed as the original cryptocurrency, altcoins provide alternative digital asset solutions to users (hence their name).

As per the original BTC whitepaper, Bitcoin is a peer-to-peer (P2P) electronic cash system that features a decentralized blockchain network while facilitating digital asset transactions between users without intermediaries.

While Satoshi described Bitcoin as a currency used for everyday payments, most users utilize the cryptocurrency as a store of value due to its deflationary mechanism – the BTC halving – that cuts the new supply generated with each mined block into half every four years.

On the other hand, altcoins focus on providing cryptocurrency solutions in other areas, such as smart contracts, decentralized finance (DeFi), digital identity, and supply chain management. As a result, they empower the crypto space with more use-cases.

In terms of investment and trading, BTC is considered the safest choice among digital assets due to the high Bitcoin trading volume as well as the fact that it is the largest cryptocurrency by market cap with the longest history of operation.

However, lower risks usually mean less potential returns. And this is where altcoins excel since high-quality altcoins often beat BTC in terms of profit during bull markets.

The Pros of Altcoin Trading

Now that you know the basics let’s see what the advantages of trading altcoins are.

  1. Increased profit potential: Since altcoins have much lower market capitalizations than Bitcoin, they have more room for growth. For that reason, trading altcoins usually comes with increased potential for greater profits.
  2. Cheaper transfer fees: While Bitcoin often struggles with low scalability, some altcoin projects feature enhanced network speed and throughput. As a result, such digital assets have lower transaction fees with rapid processing times, which comes in handy when depositing or withdrawing funds from crypto exchanges.
  3. Exposure to multiple industries: Covering a wide range of sectors, there are over 9,100 altcoins present on the market. For that reason, you can trade altcoins to gain exposure to numerous industries (being) disrupted by cryptocurrency solutions.
  4. Diversification: In addition to BTC, you can invest or trade altcoins to diversify your cryptocurrency portfolio, which is a good way to limit your risks and increase your potential returns.

The Cons of Altcoin Trading

In addition to its benefits, altcoin trading may also involve some disadvantages, such as:

  1. Limited liquidity: While major altcoins are listed on many cryptocurrency exchanges, traders often struggle to gain exposure to the ones with very low market capitalizations. And, even when they find a platform to trade them, such digital assets often face issues with limited liquidity.
  2. Higher risks: Altcoins feature lower trading volumes and market capitalizations than Bitcoin. While this allows them to have better growth potential, it also comes with higher risks for traders, especially in terms of volatility.
  3. Threats of pump and dump schemes and dishonest projects: Small-cap altcoins are often subject to pump and dump schemes, presenting increased risks for traders. Furthermore, some of the new altcoin projects are run by fraudsters operating exit scams.

Altcoins: Increased Profit Potential in Exchange for More Risks

While Bitcoin offers tremendous benefits to users, altcoin traders can take advantage of alternative digital assets to increase their potential Return on Investment (ROI).

However, since altcoins feature significantly lower market caps and trading volumes than Bitcoin, investing in them comes with increased risks for users.

That said, by extensively researching assets doing your own diligence before trading them, you can eliminate most of the risks that are associated with altcoins.

If you are looking to gain easy exposure to altcoins, create an account at the next-generation, zero-fee digital asset exchange Digitex is an excellent way to get started.

When you are there, be sure to trade the ETH/USD futures trading pair and purchase Digitex’s native exchange token DGTX!

March 12, 2021
Cryptocurrency

What Are the Pros and Cons of Altcoin Trading?

Digitex
What Are the Pros and Cons of Altcoin Trading? 7

In 2009 when the anonymous Satoshi Nakamoto launched Bitcoin, BTC ruled the market for a few years as the only cryptocurrency.

Later on, crypto projects launched their own altcoins, offering alternative digital asset solutions to users.

While Bitcoin remained the top cryptocurrency, altcoins possess over 44% share in the industry with a combined market cap of $843 billion.

What Are the Pros and Cons of Altcoin Trading? 8

But what are alternative cryptocurrencies, how are they different from Bitcoin, and what are the pros and cons of altcoins for traders?

What Are Altcoins and How Do They Differ From Bitcoin?

Altcoins or alternative cryptocurrencies refer to coins other than Bitcoin. For that reason, all digital assets launching after BTC are considered altcoins.

While Bitcoin is generally viewed as the original cryptocurrency, altcoins provide alternative digital asset solutions to users (hence their name).

As per the original BTC whitepaper, Bitcoin is a peer-to-peer (P2P) electronic cash system that features a decentralized blockchain network while facilitating digital asset transactions between users without intermediaries.

While Satoshi described Bitcoin as a currency used for everyday payments, most users utilize the cryptocurrency as a store of value due to its deflationary mechanism – the BTC halving – that cuts the new supply generated with each mined block into half every four years.

On the other hand, altcoins focus on providing cryptocurrency solutions in other areas, such as smart contracts, decentralized finance (DeFi), digital identity, and supply chain management. As a result, they empower the crypto space with more use-cases.

In terms of investment and trading, BTC is considered the safest choice among digital assets due to the high Bitcoin trading volume as well as the fact that it is the largest cryptocurrency by market cap with the longest history of operation.

However, lower risks usually mean less potential returns. And this is where altcoins excel since high-quality altcoins often beat BTC in terms of profit during bull markets.

The Pros of Altcoin Trading

Now that you know the basics let’s see what the advantages of trading altcoins are.

  1. Increased profit potential: Since altcoins have much lower market capitalizations than Bitcoin, they have more room for growth. For that reason, trading altcoins usually comes with increased potential for greater profits.
  2. Cheaper transfer fees: While Bitcoin often struggles with low scalability, some altcoin projects feature enhanced network speed and throughput. As a result, such digital assets have lower transaction fees with rapid processing times, which comes in handy when depositing or withdrawing funds from crypto exchanges.
  3. Exposure to multiple industries: Covering a wide range of sectors, there are over 9,100 altcoins present on the market. For that reason, you can trade altcoins to gain exposure to numerous industries (being) disrupted by cryptocurrency solutions.
  4. Diversification: In addition to BTC, you can invest or trade altcoins to diversify your cryptocurrency portfolio, which is a good way to limit your risks and increase your potential returns.

The Cons of Altcoin Trading

In addition to its benefits, altcoin trading may also involve some disadvantages, such as:

  1. Limited liquidity: While major altcoins are listed on many cryptocurrency exchanges, traders often struggle to gain exposure to the ones with very low market capitalizations. And, even when they find a platform to trade them, such digital assets often face issues with limited liquidity.
  2. Higher risks: Altcoins feature lower trading volumes and market capitalizations than Bitcoin. While this allows them to have better growth potential, it also comes with higher risks for traders, especially in terms of volatility.
  3. Threats of pump and dump schemes and dishonest projects: Small-cap altcoins are often subject to pump and dump schemes, presenting increased risks for traders. Furthermore, some of the new altcoin projects are run by fraudsters operating exit scams.

Altcoins: Increased Profit Potential in Exchange for More Risks

While Bitcoin offers tremendous benefits to users, altcoin traders can take advantage of alternative digital assets to increase their potential Return on Investment (ROI).

However, since altcoins feature significantly lower market caps and trading volumes than Bitcoin, investing in them comes with increased risks for users.

That said, by extensively researching assets doing your own diligence before trading them, you can eliminate most of the risks that are associated with altcoins.

If you are looking to gain easy exposure to altcoins, create an account at the next-generation, zero-fee digital asset exchange Digitex is an excellent way to get started.

When you are there, be sure to trade the ETH/USD futures trading pair and purchase Digitex’s native exchange token DGTX!

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Latest News

Top 5 Reasons Ethereum Is King of the Blockchains 11

Top 5 Reasons Ethereum Is King of the Blockchains

Crypto Industry
Digitex Futures
• Sarah Rothrie
May 29, 2019

Although Ethereum was the first ever Dapp platform, it now faces fierce competition from the likes of EOS, Tron, and Zilliqa. In the world of blockchain, competition isn’t just about racing for the biggest market cap and the highest rankings. Platforms are jostling for users, developers, and investment in new projects. But despite all that noise, Ethereum is still standing stronger than ever. Here, we list the top five reasons the Godfather of Dapp platforms still has the brightest future. Continue reading

May 29, 2019
Crypto Industry
Digitex Futures

Top 5 Reasons Ethereum Is King of the Blockchains

Sarah Rothrie
Top 5 Reasons Ethereum Is King of the Blockchains 12

Although Ethereum was the first ever Dapp platform, it now faces fierce competition from the likes of EOS, Tron, and Zilliqa. In the world of blockchain, competition isn’t just about racing for the biggest market cap and the highest rankings. Platforms are jostling for users, developers, and investment in new projects. But despite all that noise, Ethereum is still standing stronger than ever. Here, we list the top five reasons the Godfather of Dapp platforms still has the brightest future. Continue reading

Latest News

The Binance Hack Highlights the Benefits of Non-Custodial Accounts 13

The Binance Hack Highlights the Benefits of Non-Custodial Accounts

Crypto Industry
Digitex Futures
• Christina Comben
May 9, 2019

Shocking reports come from cryptocurrency intelligence agencies like CipherTrace all the time. Well over $1 billion’s worth of cryptocurrencies has been stolen from exchanges in crypto’s short history already. Yet, when well-known names like Binance start appearing on the victim list, it hits a little closer to home. With 7000 BTC stolen, the Binance hack is only the sixth largest of all time. But it serves to highlight once again the need for non-custodial accounts. Continue reading

May 9, 2019
Crypto Industry
Digitex Futures

The Binance Hack Highlights the Benefits of Non-Custodial Accounts

Christina Comben
The Binance Hack Highlights the Benefits of Non-Custodial Accounts 14

Shocking reports come from cryptocurrency intelligence agencies like CipherTrace all the time. Well over $1 billion’s worth of cryptocurrencies has been stolen from exchanges in crypto’s short history already. Yet, when well-known names like Binance start appearing on the victim list, it hits a little closer to home. With 7000 BTC stolen, the Binance hack is only the sixth largest of all time. But it serves to highlight once again the need for non-custodial accounts. Continue reading

Latest News

Developer Talent at Its Best--We’re Proud to Call ETHParis Hackathon Winners SmartDec Our Partner 15

Developer Talent at Its Best–We’re Proud to Call ETHParis Hackathon Winners SmartDec Our Partner

Crypto Industry
Digitex Futures
• Christina Comben
March 22, 2019

Digitex has been ramping up our developer partnerships to bring you the most robust futures exchange possible. This includes the brilliant SmartDec team, which has been working alongside Digitex from the very beginning. Known as the smart contract experts, SmartDec recently showcased their expertise by winning a hackathon at ETHParis. Find out more on who they are and what they do for us here. Continue reading

March 22, 2019
Crypto Industry
Digitex Futures

Developer Talent at Its Best–We’re Proud to Call ETHParis Hackathon Winners SmartDec Our Partner

Christina Comben
Developer Talent at Its Best--We’re Proud to Call ETHParis Hackathon Winners SmartDec Our Partner 16

Digitex has been ramping up our developer partnerships to bring you the most robust futures exchange possible. This includes the brilliant SmartDec team, which has been working alongside Digitex from the very beginning. Known as the smart contract experts, SmartDec recently showcased their expertise by winning a hackathon at ETHParis. Find out more on who they are and what they do for us here. Continue reading

Latest News

Today Is Vitalik Buterin’s Birthday - We Wish You a Happy One from Digitex! 17

Today Is Vitalik Buterin’s Birthday – We Wish You a Happy One from Digitex!

Crypto Industry
Digitex Futures
• Trekk
January 31, 2019

If you’ve been in the crypto space for any amount of time you’ve heard the name Vitalik Buterin at least once. And if you’ve somehow never heard of the “blockchain tech god” of Ethereum, continue reading. Learn why Digitex agrees that Vitalik is a shining light in the crypto universe and join us in wishing him a happy birthday! Continue reading

January 31, 2019
Crypto Industry
Digitex Futures

Today Is Vitalik Buterin’s Birthday – We Wish You a Happy One from Digitex!

Trekk
Today Is Vitalik Buterin’s Birthday - We Wish You a Happy One from Digitex! 18

If you’ve been in the crypto space for any amount of time you’ve heard the name Vitalik Buterin at least once. And if you’ve somehow never heard of the “blockchain tech god” of Ethereum, continue reading. Learn why Digitex agrees that Vitalik is a shining light in the crypto universe and join us in wishing him a happy birthday! Continue reading

Latest News