Ethereum Gas payments hit an 8-month high amid the ERC-404 frenzy
Ethereum network gas payments hit eight-month high amid surge in demand for new, unofficial experimental token standard ERC-404.
Ethereum network gas prices averaged 70 gwei ($60 for a regular transaction) on February 9, with peak gas costs reaching 377 gwei – a level not seen since May 12, 2023.
While the reasons for the rise in gas prices can be attributed to a variety of factors, the buzz surrounding the ERC-404 token standard has reached its peak as it begins to pick up steam throughout the crypto sector.
ERC-404 kicked off the wave on February 5 when a project called Pandora released its beta phase. Since then, it has gained over 6,100% and has raised over $474 million.
ERC-404 aims to combine ERC-721 non-perishable tokens (NFTs) with ERC-20 tokens, which some have described as distributed NFTs, allowing multiple wallets to each own a portion of an NFT and trade or use that portion. Share to get a loan.
Although the prefix “ERC” is attached to the new type of token, the name is very informal. Speaking to Cointelegraph on February 9, one of the developers behind the Pandora project, who goes by the nickname “ctrl”, said that the team is working on significantly reducing gas costs.
“We are trying to facilitate gas because this is part of the big adoption and integration protocols […] So in some cases we can reduce gas bills by 300% to 400%.
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According to X user PopPunk, co-founder of gas auditing firm Gaslight, an ERC404 token uses about three times the amount of gas required for an NFT transaction on average.
The average ERC404 transfer is 125,000 gas units.
3x more gas than an average ERC721A relay.
This is fantasy fuel.
Gaslight can either: 1) build a more optimized (and more compliant version of this standard) 2) ignore it and fade it into the ether.
— Pop Punk (@PopPunkOnChain) February 6, 2024
Most of the network usage on February 9 was due to increased activity on the decentralized exchange protocol Uniswap.
Much of this activity can be attributed to the significant trading volumes of Pandora, Defrogs and other ERC-404 projects in the name list, which generated more than $600 million in transaction volume last week.
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