By Solomon Odunayo
According to blockchain explorer, Etherscan, someone just paid $7.54 for transferring 74.6 million Synthetix Network Tokens (SNX), worth relatively $1 billion on the Ethereum network.
According to the report, the funds were transferred from a contract known as “Synthetix: Reward Escrow.”
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Synthetix is a decentralized finance (DeFi) protocol for trading asset-pegged synthetic tokens on the Ethereum network.
It’s worth noting that this is one of the largest single cryptocurrency transactions in history. Last summer, a Bitcoin wallet came close to moving $1 billion after moving 101,857 BTC worth relatively $933 million at the time.
On the other hand, such a transaction would amount to roughly $4 billion if was initiated at current prices.
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$7 fee to transfer $1 Billion, in less than a minute, on a completely public trustless network. Just imagine what #Ethereum will be capable of in 10 years. https://t.co/5R8OiQujbD
— Nick de Bontin (@Ndebontin) January 15, 2021
While the SNX transaction is impressive by itself, Twitter users quickly pointed out that Ethereum transaction fees, nonetheless, are still a bit high for everyday use. A $7 fee becomes significantly move expensive if you only want to move a few dollars’ worth of tokens.
The best part ethereum not fit for daily transactions right now.
Same fees for 1$ in transaction.
So u have to pay 7x for your orignal transfer amount.
— FLUX (@freemaicrypto) January 15, 2021
As reported back in May 2020, more than half of all Ethereum transactions were for less than $20, and 80% of transactions made were under $90. According to data scientist Alex Svanevik, co-founder of D5, this reflected how people use Ethereum in general.
55% of all ETH transactions are smaller than 0.1 ETH.
(not including internal transactions)
cc @tayvano_ pic.twitter.com/IvrZlRWsA0
— Alex Svanevik 🧭 (@ASvanevik) May 6, 2020
He explained that Ethereum is the network of choice for many DeFi projects that are focused on micro-transactions. Additionally, it is a popular hub for mining pools, gambling apps and exchanges.
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However, since DeFi came to limelight around September 2020, Ethereum transaction fees skyrocketed. Just recently, they have surged by almost 400%, reigniting debates on whether Ethereum is suitable for mainstream adoption.