Average gas fees reached an all-time high of $ 17.5 per trade on Feb.3, triggering some exchanges to stop Ether and ERC-20 withdrawals. Japanese cryptocurrency exchange Liquid has temporarily disabled Ether (ETH) withdrawals while the altcoin reached all-time highs.
According to an announcement made on Feb. 4th, Liquid has stopped withdrawals for ETH and some ERC-20 tokens due to the large increase in transaction costs or gas fees. In the announcement, “Service will continue when gas charges return to normal levels. All other cryptocurrencies are working normally ”.
On February 4th, the ETH price increased by another 20% over the past seven days to over $ 1,600. The rising price reached new historic highs, steadily raising transaction costs.
According to data from YCharts, gas fees reached an average of $ 17.5 per transaction on February 3rd.
As previously reported, gas fees began to see significant growth in early January 2021, when Ethereum broke its previous record of over $ 1,400.
The latest increase in gas fees has had a major impact on a number of decentralized finance projects, with some DeFi transaction fees rising to over $ 1,000. Fees on major decentralized exchanges like Uniswap and SushiSwap rose to abnormal levels between $ 40 and $ 75. DeFi users looking for lower fees have reportedly turned to Ethereum alternatives like Flamingo.
Kain Warwick, founder of Synthetix, the Ethereum-based synthetic asset issuance platform, expressed confidence that increased ETH fees will further increase transaction volumes:
Obviously, we need to see what user behavior is when not subsidized by fees, I strongly suspect that tx volume will only increase from here. You can’t do much right now, but you can sit down and crush the mint button.
At the time of release, Ether transaction volumes increased from $ 37 billion to $ 44 billion on January 28. The second largest cryptocurrency was trading at $ 1,639, up 6.3% in the past 24 hours.