On Saturday, two leading smart contract blockchain, Solana and Ethereum, had a major blow up which led to the realization of the significance of how transaction fees are set on decentralized systems.
Solana blockchain came to a standstill after which it had to be started. It was shut for about 8 hours. When network validators performed “cluster restart,” the operations were restarted again.
On Sunday, the launch of a sale by Yuga Labs for land NFTs led to the rise in transaction fees on Ethereum, leading to NFT buyers spending approx. 71,000 ether (ETH), worth around $200 million USD just on fees.
It is also interesting to note that there was some good news despite the issues faced by the networks. Both the leading networks experienced unbelievable rises of real system demand, and that’s what matters the most.
Even if we look at the price of SOL, Solana’s token that plummeted almost 11 % after the ecosystem’s freeze, is greatly bullish.
The importance of two systems’ different approaches to big demand rise was also realized.
Both the blockchins include transaction fees, and the weekend’s issues made it clear that any digital payment system without them is hard to imagine.
Ethereum took the path of a fairly straightforward fee market to solve the problem, resulting in users bidding against each other for block space.
Solana took a different path. Since the fees on Solana are based on recent block space usage on which they are automatically instead of a real-time bid-based market.
It’s also worth mentioning that Solana alleged the network freeze on “bots” however that doesn’t translate to the fact that it was a malicious attack. Rather, the automated bots were trying to gain an NFT mint using the Candy Machine dapp. Partly due to the transaction fees set on Solana, it was quite logical of these agents to “spam” millions of transactions onto the chain.
Then, it was a little weird to see Metaplex, the Candy Machine developers, made the announcement that it’s going to implement “a botting penalty” within the dapp itself. It’s not a long-term solution but just a fine gesture.
However, the system backers could have a messaging problem if Solana’s fee structure is revised. On the basis of its ability to handle transactions rapidly and for lower cost than the second Chain, Solana has been marketed to a significant degree.
Bored Apes turning their own independent layer 1 blockchains could be another solution on the table that Yuga Labs might be planning.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
Source: https://www.thecoinrepublic.com/2022/05/05/analyzing-the-weekends-blow-up-of-solana-and-ethereum-is-rise-in-ethereums-fees-justified/