In the last 16 days, Ethereum users have paid more money in fees than Bitcoin Billionaire users. According to CoinMetrics, Ethereum users are paying more commissions than Bitcoin users for the second week in a row.
Earlier this month, users of the Ethereum network have spent at least $500,000 in commissions per day, reaching a peak of $3.5 million on June 11. Meanwhile, Bitcoin users were spending between $300,000 and $400,000 in commissions per day.
Ethereum’s transaction volume increased more than 100% in the last 24 hours
It is likely that Ethereum users have started paying more for network usage due to a sudden growth in Decentralized Finance (DeFi), driven by the launch by Compound of its COMP governance token. The token is being distributed to users who interact with the platform’s lending protocol, which means that users are rewarded for lending or committing to lending money.
Growth of DeFi networks
CryptoCompare data shows that the COMP token rose to $380 in the first few days of trading before starting to fall to $230 at the time of this publication. In order to have more tokens in hand, users began to lend and commit to the Compound platform.
The rapid growth of the DeFi market has not only led to an increase in Ethereum network fees, but also to network congestion, which in turn has led to increased rates. It becomes a cycle that feeds back all the time.
According to data collected by DeFi Pulse, more than $1 billion is locked up on the platforms.