Average Ethereum transaction fee hits $60 amid SHIB hype

On Tuesday, May 11, the average transaction fee on the Ethereum network hit an all-time high of $60. This was driven by the frenzy around Shiba Inu (SHIB), a clone of the meme cryptocurrency Dogecoin.

Outlined below are approximate gas costs for various types of transactions at a median gas price of 198 Gwei. At the time of writing, the fee for an exchange on Uniswap is $136.07, and a deposit on Compound is $202.95.

The Block researcher Igor Igamberdiev noted that the rise in fees was sparked by SHIB hype. He said that interest in the token was buoyed by the Binance listing.

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Because of SHIB, we are now seeing high gas prices.

In the last three days, transactions with the SHIB token contract interaction consumed 10%+ of block gas.

The chart shows that interest in SHIB was starting to fade, but the Binance listing brought it back to life. pic.twitter.com/o1rSVeVKGg

— Igor Igamberdiev (@FrankResearcher) May 11, 2021

“The increase in volumes in the SHIB-WETH liquidity pool on Uniswap v2 began on May 7 and peaked the next day,” — noted Igamberdiev.

According to him, on May 8 Coinbase Wallet users also began buying SHIB. For this reason, the wallet recorded record trading volumes.

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The largest among the transactions going through the Uniswap router is associated with CEXs (probably MM).

Interestingly enough, on May 8, Coinbase Wallet users also jumped into the game and started buying SHIB.

Because of this, the wallet yesterday had record volumes. pic.twitter.com/Hp0udoxojF

— Igor Igamberdiev (@FrankResearcher) May 11, 2021

Vitalik Buterin is the largest holder of SHIB. Igamberdiev noted that the Ethereum co-founder “could simply withdraw 93% of the pool’s liquidity without any price impact.”

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49.5% of the token supply was added to Uniswap after token creation.

LP tokens from this pool were sent to @VitalikButerin along with the remaining SHIB.

Therefore, Vitalik, instead of selling, can simply withdraw 93% of the pool liquidity without any price impact ($118M). pic.twitter.com/aepGZqDeL6

— Igor Igamberdiev (@FrankResearcher) May 11, 2021

According to the researcher, unrealised gains of the top-50 “Diamond Hands» ranges from $5 billion to $2.5 billion.

Of the top ten SHIB holders, only one sold tokens in the last week. Igamberdiev noted that this, he said, stems from the coin’s low liquidity.

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According to Nansen, out of the Top 10 traders’ balances, only one sold tokens in the last week.

As already mentioned, the main reason for this is the very low liquidity, which will not allow to cash out in size.

Let’s see what happens when retail interest disappears pic.twitter.com/hhQ8tAEJcv

— Igor Igamberdiev (@FrankResearcher) May 11, 2021

Earlier analysts identified two wallets whose holders had accumulated substantial SHIB before the price rally. The unrealised gains of one of them are estimated at $2.4 billion at the current rate.

As reported, on May 10 the price of Shiba Inu briefly reached $0.000033, updating an all-time high.