Crypto enthusiasts have noticed that the Ethereum blockchain has come awfully close to reaching capacity due to the added transactions stemming from the Tether (USDT) network. The transaction count since mid-August shows the ERC20 version of tether has surpassed the original version that uses BTC. ERC20 tether transactions cost users more than $260,000 in the last 30 days and the over-saturation of trades is 17X larger than the infamous Crypto Kitties fiasco.
Tether Migrating to ETH Sparks Capacity Fears
In December 2017 during the height of the crypto bull run, the Ethereum blockchain was swamped with unique cats similar to Pusheens that could be collected and traded using the ETH network. The Crypto Kitties event prompted the creators to increase the cat birthing fee in order to incentivize miners to add birthing transactions to the chain. Fast forward to 2019 and Tether has started migrating coins from the Omni Layer network which uses the BTC chain to an ERC20 version which runs on top of the ETH chain. Tether is a $4 billion dollar network with coins spread across multiple blockchains which include BTC (Omni), ETH (ERC20), EOS, and Tron. Data pulled from the website Coin Metrics shows that the ETH-based tether transactions have surpassed the BTC-based versions this month. Today, on August 28, there are 39,000 tether transactions on the BTC network via Omni, but that number is eclipsed by the 126,000 ETH-based tether transactions. At the time of publication, there’s roughly 1.5 billion USDT minted using the ETH chain and 2.5 billion tied to the Omni Layer network.
Since the tether transactions being used on the ETH chain have spiked significantly, the crypto community has been observing the ETH chain grow congested again. Ethereum cofounder Vitalik Buterin told Bloomberg this week that the “[ETH] blockchain has been almost full for years.” ““I think it’s still good to develop apps, but anything substantial should be developed with scalability techniques in mind, so that it can survive higher transaction fees that would come with further growing demand for Ethereum — In the longer term, Ethereum 2.0’s sharding will, of course, fix these issues,” Buterin asserted during the interview. Prominent Ethereum evangelist and founder of Mythos Ryan Sean Adams explained that every asset on Ethereum is “a future revenue source for ETH stakers.” “Tether paid 993 ETH over the last 30 days,” Adams said to further bolster his prior statement.
— Crypto Mak