One of the reasons for the success of Ethereum’s second layer solutions (ETH) is their low transaction costs. Despite this, Vitalik Buterin, the network’s famous co–founder, believes that a transaction on these layer 2s should cost no more than 5 cents to be acceptable.
Vitalik Buterin talks about Ethereum’s layer 2
The Ethereum (ETH) network found itself in the spotlight in 2021 with the emergence of decentralized finance (DeFi) and non-fungible tokens (NFTs). However, this wave of new users has led to blockchain congestion and increased transaction fees.
As a result, so-called “layer 2” solutions have emerged. In short, these solutions allow to deport part of the transaction data to their network, inevitably leading to a decongestion of the main blockchain.
According to the co-founder of Ethereum, Vitalik Buterin, the transaction costs of these layer 2 solutions should not exceed 5 cents to be “truly acceptable”.
This comment comes in response to Ryan Sean Adams, the founder of the Bankless podcast. He was presenting different layer 2 solutions and their transaction costs, making it clear that “this is Ethereum and it’s cheap”.
But then, what are the layer 2 fees?
According to information from on-chain data aggregator L2Fees.info, the only layer 2 solution to meet Vitalik Buterin’s requirements is Metis Network. Transaction fees are currently $0.02, although it still costs $0.14 to swap tokens.
At the bottom of the rankings are Arbitrum One, with fees close to $0.7, and Aztec Network, which peaks at $2.01 per transaction. Lately, the Ethereum network has been relatively affordable, at just $2.1 per transaction and $10.48 to trade tokens.
However, the successful launch of the “Otherside” collection of NFTs has led to a temporary explosion in transaction prices. While sales exceeded $560 million in a 24-hour period, mint fees increased tenfold. Some users even had to pay more than $14,000 to get one of the new NFTs from hit studio Yuga Labs.
This phenomenon, called “gas war”, is common on Proof-Of-Work (PoW) blockchains like Ethereum. It occurs when the number of transactions becomes abnormally high during a very short period of time. Problems that should logically be mitigated after the network’s transition to a Proof-Of-Stake (PoS) consensus.
