Ethereum’s Gas Spike Forces Coinbase Pro to Pass Network Fees to Customers
While Ethereum network fees have jumped to new highs this year, the popular cryptocurrency exchange, Coinbase Pro, announced that the trading platform would be passing network fees onto customers. The move followed the exchange listing Uniswap’s native token UNI, an airdrop that saw miners collect close to $1 million in gas in less than an hour.
The decentralized finance (defi) ecosystem has seen significant demand in 2020, but it has also contributed to the Ethereum (ETH) network’s rising fees. Ethereum miners are collecting a massive amount of revenue from gas payments, as miners are capturing between $700k to $850k per hour or 700 gwei per transaction.
ETH fees have touched an all-time high in 2020 and defi lending applications, yield farming, and decentralized exchange swaps (dex) have bolstered high fees.
The centralized exchange (cex), Coinbase Pro announced on Thursday that network fees will now be passed down directly to their customers.
“Starting today, Coinbase Pro will pass along network fees directly to our customers,” the exchange tweeted. “These fees (sometimes referred to as “gas fees” on the ETH blockchain) are paid directly to crypto miners that process transactions and secure the respective network,” the San Francisco-based exchange further added.
Meanwhile, on social media, a number of people got upset about the announcement, while others said that alternative blockchain networks were more beneficial. “Once again, this showcases the use case for low fee transaction blockchains like Bitcoin Cash (BCH),” the BCH proponent David Shares tweeted to Coinbase Pro in response to the fee announcement.
A few other individuals expected the move and said that any profitable company would do the same.
“A lot of people seem upset at this but it just makes sense to me,” one individual wrote. Transactions are actually getting expensive now and they’re running a business so that’s why they have to up their prices.”
Coinbase Pro detailed that in the past, the San Francisco firm absorbed the network fees for the customer. “Historically, Coinbase Pro has absorbed these fees on behalf of our customers. However, as crypto has begun to gain broader adoption in applications like defi, payments, and other projects, networks have gotten busier,” the company’s followup tweet said.
Additionally, Coinbase detailed that the company does not charge people for transferring funds between two different Coinbase accounts. “To ensure a smooth experience for our customers and reasonable transaction processing times, Coinbase Pro will charge a fee based on our estimate of the network transaction fees that we anticipate paying for each transaction,” the company concluded.
What do you think about Coinbase Pro passing on network fees to customers? Let us know what you think about this subject in the comments section below.
Ethereum’s Gas Spike Forces Coinbase Pro to Pass Network Fees to Customers from Bitcoin News.