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May 2, 2022

BAYC Apologizes For the Rise in Ethereum Gas Fees

Yuga Labs, the business behind the Bored Ape Yacht Club (BAYC), raised over $320 million in their weekend metaverse property sale. However, the largest-ever non-fungible token (NFT) issuance had an unintended consequence: Ethereum (ETH) gas fees reached thousands of dollars. Gas prices were roughly 100 or 200 times more than usual, according to Decrypt.

Gas costs are the cost of registering a transaction on the Ethereum blockchain, and they rise when the network is overburdened. Even in normal circumstances, the costs might be excessively expensive, particularly for little transactions.

Because of Ethereum’s high gas prices, a variety of lower-cost competitors have gained substantial market share in recent years.

Nonetheless, Ethereum is the most popular smart contract currency and hosts the majority of applications, particularly decentralized banking apps.

According to DeFi Llama, Ethereum has more than half of the money invested in blockchain applications.

ApeCoin users competed on Saturday to purchase “Otherdeeds,” which are plots of land in Bored Ape Yacht Club’s metaverse, Otherside. The craze drove Ethereum gas costs to previously unheard-of heights.

Each of the 55,000 NFT plots, according to Bloomberg, costs roughly $5,800 in ApeCoin (APE) plus gas expenses. The cost of minting the Otherdeed NFTs was roughly $6,000 per deed, which was more than the cost of the land itself.

The price increase harmed everyone attempting to utilize the Ethereum network.

On Saturday night, for example, if you sought to buy or sell cryptocurrency on an Ethereum-based decentralized exchange, you’d have faced exorbitant gas expenses. One Twitter user complained about trying a $5 transaction and being asked to pay more than $4,500 in petrol.

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Yuga Labs apologized for temporarily shutting out the lights on Ethereum. It becomes plainly evident that ApeCoin will need to migrate to its own chain in order to fully scale.