Ethereum has grown at an exponential pace in recent times, taking the cryptocurrency industry by storm. The Decentralized exchanges see higher Ethereum trading volumes.
With the fees of Ethereum deposits going down, the trading volume has gone substantially down on Centralized exchanges.
Ethereum Transaction Fee declines on Centralized Exchanges
There is a substantial increase in the Ethereum Trading volume on the Decentralized exchanges as the Gas costs of the Ethereum transactions goes down on the centralized exchanges. Glassnodes data showed that the DeFi space is taking away a massive share of Ethereum trading from the centralized exchanges.
The fees spent on Ethereum deposits on the Centralized networks have sharply declined, showcasing a significant shift of deposits on the Decentralized exchanges. While the fee or gas cost was around 26 Percent in 2017, it is less than 1 percent now.
The Ethereum miners and users must pay the gas fees to execute transactions on the Ethereum network, even though the fees keep changing depending on the network demand in the market and the price of Ether token. Every transaction should meet the miner’s threshold; else, it can be denied or delayed. If the transaction fee on a centralized network declines, the overall activity on Ethereum declines on the CEXes.
The users spent most of the fees while withdrawing Ethereum on the centralized network, and there was relatively very little activity on the Centralized networks. Overall, 2020 has seen a sharp decline in Eth activity.DeFi has seen a multidimensional expansion as the crypto investors and traders line up to leverage the growing benefits and market penetration of the Ethereum blockchain. Ethereum is fast growing as a preferred crypt token after Bitcoin giving a boost to the Fees. A total locked value of more than $14.8 billion is staked on DeFi as per DeFi Pulse. Decentralized exchanges have been able to fare considerably well due to the high liquidity and resourcefulness they offer. These exchanges are more liquid, and the large volumes of assets can be traded easily without any slippage.
The information discussed by The Coin Magazine is not financial advice. This is for educational and informational purposes only. Any information or strategies are thoughts and opinions relevant to accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Do your due diligence and rating before making any investments and consult your financial advisor. The researched information presented we believe to be correct and accurate however there is no guarantee or warranty as to the accuracy, timeliness, completeness. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright The Coin Magazine All rights reserved.