Ethereum has long been plagued by high gas fees, especially during times of high traffic. However, Vitalik Buterin, the co-founder of Ethereum, has proposed a solution to make transactions faster and cheaper. This could potentially give Ethereum an edge over competitors like Solana. Let’s delve deeper into what this means for the blockchain world and how it could impact the future of the second-largest cryptocurrency.
Vitalik’s plan aims to lower the cost of transactions on the Ethereum network. Currently, gas fees are a significant issue, so the goal is to reduce fees for certain operations within the Ethereum Virtual Machine (EVM). The proposal includes lowering gas fees for operations in the 2-5 range to 1, and for operations in the 6-10 range to 2. Additionally, log operations could become nearly four times cheaper. This change has the potential to increase Ethereum’s Transactions Per Second (TPS) by up to 1.5 times without causing data build-up issues.
This move could give Ethereum a significant boost, especially in light of Solana’s recent performance. Solana has surpassed Ethereum in daily gas fee revenue, driven by the popularity of AI meme coins like Goatseus Maximus (GOAT). With Solana gaining traction, Ethereum needs to innovate and stay competitive in the blockchain space. Vitalik’s proposal to cut gas fees could be a step in the right direction for Ethereum to keep pace with its rivals.
On the price action front, Ethereum has been trading within an upwards parallel channel with a surge that led to an upward breakout, albeit short-lived. The price faced rejection at $2,773 on October 21, causing a drop to $2,454. Currently, ETH is trading around $2,531. Technical indicators suggest a bearish outlook for Ethereum, with the MACD below the signal line and the RSI indicating oversold conditions. However, the divergence between the RSI and price movement hints at a possible rebound in the near future.
In conclusion, Vitalik’s proposal to lower gas fees could be a game-changer for Ethereum, helping it stay competitive in the blockchain space. While Ethereum may face challenges in the short term, there is potential for a recovery. It remains to be seen how these changes will impact Ethereum’s position relative to competitors like Solana.