The congestion situation of ETH network has been alleviated. But before that, the mint sugar action had driven this growth
The congestion situation of ETH network has been alleviated. But before that, the mint sugar action had driven this growth.
1The new project VMPX is the main reason for the increase in ETH costs;
2Market participants are concerned about the actual utility of tokens;
From July 3 to the time of writing this article, the cost of Ethereum [ETH] blockchain increased by 57.8%. According to data shared by IntoTheBlock, the second largest blockchain earned $47 million during the aforementioned period.
When the cost of Ethereum increases, it means that the network has experienced high volatility and high traffic. In addition, this means that smart contracts consume natural gas due to consistent execution.
This is usually because some smart contracts can be very complex and require a lot of computation. However, the main driving force behind the demand for ETH related transactions is quite surprising.
The blockchain insight platform mentioned that VMPX contributes up to 18% of the cost.
VMPX is a newly launched Cryptocurrency that operates as ERC-20 and BRC-20 tokens. According to its official website, VMPX points out that it is a bridge liquidity token connecting Bitcoin [BTC] and Ethereum [ETH] blockchain. The project points out that,
"The ultimate goal of VMPX tokens is to promote the seamless exchange of BRC-20 and ERC-20 tokens through the Bitcoin Ethereum bridge. In addition, VMPX token holders can use smart contracts to convert their tokens into XN native tokens on the X1 blockchain."
The congestion situation has been alleviated
Anyway, Santiment indicates that WrappedEthereum [WETH] has the highest proportion in terms of distribution. This is not surprising, especially since VMPX requires the WETH exchange to handle transactions.
However, as of July 5th, the increase in ETH fees has slowed down. As of the time of publication, the ETH cost for destruction has been reduced to $682000. This means that Ethereum network congestion has decreased. Furthermore, the decline indicates that the initial surge in demand no longer exists.
As of the time of publication, the price of VMPX is $0.07. However, its performance from 2/hour to 7 days was not satisfactory. This is in stark contrast to its previous 30 day increase of 50%.
(Personal thoughts, not as investment advice)
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