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Ethereum (ETH) - the Gwei, power consumption and carbon footprint
Ethereum gas fees are the main disadvantage of market adoption as astronomically high fees will keep away the small investors. The fee used to pay for the transaction, the Gwei, was so high and volatile in 2021 that the crypto community started to look for alternatives, and many chose Binance Smart Chain for DeFi investments.
Fees up to $100 - $150 have nothing to do with the current crypto climate and are feeding the anti-crypto movement. I happily accepted $10 to $30 gas fees for big transfers that involved big time money, like sending the $FORTH airdrop to Coinbase, but even this amount is not acceptable.
The annual carbon footprint and the annual power consumption are other negative aspects of Ethereum. Ethereum power consumption is 43.17 TWh, equal to the annual power consumption of Hungary, while the carbon footprint is 20,5 Mt CO2, equal to the annual Carbon Footprint of Bolivia
Scalability comes into the mix when we analyze the power consumption and carbon footprint for single transactions. One transaction will consume power similar to an average US household in nearly 3 days while the carbon footprint is equal to the equivalent of 84k VISA transactions.
I am sure that Elon Musk didn't checked this data when he said Bitcoin is not so green, as definitely Ethereum is not eco-friendly either. The numbers above are quite concerning and I do hope that the future will bring cryptocurrencies with less impact on the environment.
Gas fees - back to normality
What is acceptable for gas fees and what is not? I am waiting for Ethereum 2.0 to deliver for months and I will never forget the moment when I was asked to pay 2.1 ETH ($1280) to stake $125 worth of FARM which was totally ridiculous. Few days later I was able to stake for only 4 USD.
In the last months, the average transaction fee was $50, which is immense. This issue pushed away investors from Ethereum and affected badly the DeFi world. When the $FORTH airdrop was distributed, I paid $60 worth of Ethereum to claim the FORTH tokens and to send them to Coinbase.
My Metamask had some tokens which were "locked" in there for months due to the gas fees. The Gwei was insane and I didn't afford to spend ETH for $50 transactions. The AMPL from Publish0x was going to Metamask until I decided to swap for Kucoin. However, one batch of Ampleforth was stuck in there since 2020. I decided to send it to Kucoin and swap it in there for a random cryptocurrency that I will find interesting. The transfer fee was $3.75, an amount that I was happy to pay. Having AMPL on Kucoin is much better than on Metamask, as I can easily swap it, spend it or stake it.
Last month I won two prizes at the AP Wine Meme Decathlon. I was waiting to put them to work but was impossible with the fee price spike. APWine Finance was that kind of project that joined the Cryptoverse with a bang! The DeFi protocol was created to trade future yields, where users can deposit interest bearing tokens from other protocols for a set period of time and trade the returns in advance. The trading of unrealized yield will allow the users to speculate the evolution of yield and hedge the risk on passive revenue.
The 50 USD coin received from the meme competition were sent to Celsius Network for a minimal fee of 0.55 USD. They were being lazy on Metamask and now they are earning some dividends.
Back to Metamask, where I have 1.67 UNI. I swapped some Ethereum months ago, just to make a transaction on UniSwap. This happened after the $UNI airdrop and was done just for the hope of a second airdrop. The gas fee was identical to the USDC transfer, only $0.55!
The summer cleaning in the Metamask wallet was nice and cool. At the moment the USDC gains 8.88 APY and UNI pays 2.5% as dividends. In few week both assets will pay back the Gway and will start earning rewards.
Don't get me wrong ... I don't hate Ethereum, I hate high gas fees. I had 40 Ethereum in my hey days and sold them all. If you want to read the story than check to Ethereum I love you 3000!