Ethereums Layer-2 Networks Drive Down Congestion and Fees, Boosted by Friend.tech and Coinbases Base

Crypto’s latest fad doesn’t drive up congestion and fees on Ethereum

The recent frenzy around the crypto-fueled social marketplace Friend.tech did not cause congestion and high fees on the Ethereum blockchain, thanks to the use of layer-2 networks like Coinbase’s Base. Ethereum’s efforts to scale using layer-2 projects have been successful in reducing congestion and fees on the main network. The availability of layer-2 networks has contributed to the significant drop in transaction fees on Ethereum in recent weeks. This decline is especially remarkable considering the success of Friend.tech, which attracted over 100,000 users and generated $25 million in fees. Older and larger layer-2 networks, such as Arbitrum and Optimism, are now handling a large number of transactions on Ethereum.

Less Ethereum congestion

Ethereum’s gas fees have historically increased during periods of high activity, resulting in congestion and higher fees.
With the introduction of layer-2 networks, Ethereum’s gas fees have remained stable even as transaction activity picks up.
In the past, projects like CryptoKitties and Otherdeeds caused gas fees to reach extremely high levels.

Friend.tech and Base

Friend.tech, a web3 app, experienced significant activity but did not cause congestion on Ethereum due to its existence on the Base sub-network.
Ethereum’s gas fees dropped during the peak of the Friend.tech frenzy.
The heaviest traffic on Friend.tech has now passed, and Ethereum fees remain at sustainable levels.

Ethereum’s future

Ethereum’s upcoming upgrade, proto-danksharding (EIP-4844), is expected to further improve scalability and reduce costs for layer-2 networks.
The use of layer-2 networks has allowed Ethereum to support higher transaction volumes.
Bitcoin transactions have increased recently, potentially alleviating some volume from Ethereum.

Hot Take

The success of layer-2 networks in reducing congestion and fees on Ethereum is a positive sign for the scalability and future of the blockchain. Projects like Friend.tech demonstrate the benefits of layer-2 solutions and their ability to handle high transaction volumes. As Ethereum continues to evolve and implement upgrades, it is likely to see further improvements in scalability and cost-effectiveness.