- Two days ago, some 559 transactions got delayed on the Coinbase exchange due to the congestion on the Ethereum network.
- The total time required to execute all the pending blocks was 110 minutes. However, in the process Ethereum’s trade was not affected by the spike.
- Coinbase on 1st August, at 9.45pm (Pacific Standard Time) reported the first transaction fee spike.
Two days ago, some 559 transactions got delayed on the Coinbase exchange due to the congestion on the Ethereum network. The reason behind this was the sudden spike in the Ethereum transaction fees and the delayed transactions got executed after 15 minutes of this spike. The total time required to execute all the pending blocks was 110 minutes. However, in the process Ethereum’s trade was not affected by the spike.
Ethereum Transaction Fees Increasing Continuously
Transaction fees or network fees are introduced in order to validate the transactions, smart contracts or decentralised applications on the Ethereum network which are necessarily paid by the miners. The fees are measured in ‘Gas’. Previously, it had been reported that Ethereum’s transaction fees are continuously increasing. So if the gas price increases, it becomes costly for the miners to operate. A week ago, one of Ethereum rival tweeted that Ethereum’s gas fees is moving forward to an all time high record. This makes transactions extremely costly for users and poses challenges for DeFi transactions.
The gas fee on Ethereum is approaching its new record. This ridiculously expensive cost becomes a heavy burden to users and an obstacle of defi transactions. It's a golden window for alternative solution to overtake. pic.twitter.com/TjrrZGsSYQ
— Da Hongfei (@dahongfei) July 23, 2020
How Gas Price Affects The Execution Time Of A Transaction
As we know, Gas price has no specific limit. So miners can raise the limits or decrease the limit as per their will. If the transaction fee for a certain transaction is high, the miners tend to prioritise them in place of the transactions which have relatively lower fees. In this process, the blocks with high gas price gets executed faster leaving behind the other blocks. Hence, rise in gas price may lead to network congestion as we have seen in the most recent August 1 congestion.
How Coinbase Coped Up With The Congestion
Coinbase on 1st August, at 9.45pm (Pacific Standard Time) reported the first transaction fee spike. Consequently, transactions accumulated and withdrawals from Coinbase’s platform got delayed. When the ETH transaction fees were at peak at 11:30pm (Pacific Standard Time), Coinbase reported a delay of total 559 ETH and ERC20s transactions. But how Did Cope Up With This Spike In Transaction Fee? The San Francisco based cryptocurrency exchange, Coinbase deployed a certain mechanism known as Transaction replacement. This protocol allows them to adjust the network fees for the transaction. Considering the price volatility and vigorous network activity associated with Ethereum such congestions have become more of a common thing.