August 17, 2021: 1559 Problems ⛽🛢️

Why Ethereum Gas Fees Remain High Post London

Runaway inflation… Middle East turmoil… ‘70s throwback is chic. Ethereum’s channeling that retro spirit in the form of soaring gas prices.

Observe the big jump on August 5th, when EIP-1559 went live.

So what gives, is it time to grab the pitchforks?

Lark Davis @TheCryptoLark

#ethereum fees are going insane with the #nft markets pumping like crazy! We are now seeing spikes in gas fees that make ETH basically unusable for all but the richest users. Thread

W⬡rmholeOracle @WormholeOracle

So does anyone feel UX improvement from 1559? I haven’t been able to try, gas has been outrageous since 1559. Hmm

BasedPotato @BasedPotato4

so many cool things on ethereum deemed unsuable because of gas

Matty @DCLBlogger

I'll be honest with you. The UX for the NFT industry as a whole still SUCKS. - Learn crypto - Learn Metamask - Put up with gas fees - Confusing landing pages - Little market data - gas wars, expensive to participate, We'll grow even faster as the above are solved, (in time).

On the plus side, most predictions around EIP-1559 have panned out. The intent of London was not to lower gas prices, but to improve predictability around gas fees: easier estimation and less volatility. This effect is easy to confirm visually:

takenstheorem @takenstheorem

Gas price estimated from 100,000 blocks, before/after #Ethereum London. (...less volatility also means you have fewer wonderful weekend downswings in price.) (WIP; need to double check.)

Block utilization has also improved:

vitalik.eth @VitalikButerin

Another fun analysis: why is post-London chain capacity ~9% higher than it was before? Turns out the effect is evenly split between three causes: (i) ice age delay, (ii) not-always-full pre-London blocks, (iii) mathematical artefacts of EIP 1559 formula.

reddit.comr/ethereum - Why has the chain capacity increased by ~9% after London? Three answers...426 votes and 51 comments so far on Reddit

Recovery from gas spikes is also alleged to be faster:

Tim Beiko | timbeiko.eth @TimBeiko

To illustrate this: we went from 40 gwei, to 1750, back to ~80 all in 100 blocks! That seems pretty efficient!

Ethprofit 🦇🔊🇪🇹 @Ethprofit

Interesting is the fact that while gas fees do spike, they only do so for 20-30 minutes, then returning to normal. This was way better than back in Feb/March when it was congested for days if not weeks. ethprofit.net/burn $ETH #ETH #Ethereum

In terms of these intended effects of 1559, the fork has been a success. However, one major prediction that has not yet panned out is a drop in miner fees.

To date, miner revenue has actually increased:

glassnode alerts @glassnodealerts

📈 #Ethereum $ETH Miner Revenue just reached a 1-month high of $11,149,991.24 Previous 1-month high of $7,783,668.09 was observed on 10 August 2021 View metric: studio.glassnode.com/metrics?a=ETH&…

One potential issue is that several wallets, including the extremely popular MetaMask, have yet to support 1559.

Victor Naumik @vicnaum1

Another chart shows the adoption percentage of #EIP1559 transactions after #ETH #LondonFork. Despite growing - after 4 days it still stays around 8-10%. Probably because major players such as @MetaMask or @OpenZeppelin Defender haven't rolled this out yet #Ethereum #cryptotwitter

MetaMask tends to over-estimate gas prices, and pre-1559 transactions are more likely to pay this excess. For 1559 style transactions, the developer rule of thumb is that a 2 gwei priority fee on top of the base price will usually confirm quickly.

banteg @bantg

Are miners more willing to include EIP-1559 transactions? All dynamic fee txs I sent so far get confirmed in the next block even with 1-2 gwei priority fee, while legacy transactions sit in the mempool for 5-10 minutes, even if they pay more for gas.

Taylor Monahan @tayvano_

@bantg The answer is in the tx pool ordering. They are sorted by effective tip: the lower of (Max fee - current base fee) OR (Max tip) Current base: 1000 EIP: 2000 / 3 = effective tip 3 Legacy: 1000 / 1000 = effective tip 0

If base fees do indeed come down as more users switch away from legacy-style transactions, that 2 gwei tip would start looking pretty nice.

Another holdover in the 1559 world is pumping other chains every time gas spikes:

NeedaNft @needacoin

$Eth: +6.9% over the last 7 days Gas will cost you your first born $Ftm: +41% over the last 7 days Gas is basically free, have fun.

austin.sol / greenjuice.eth ⛰🌊 @austinvirts

lets take a moment to acknowledge that gas wars are going to be a leading factor in driving NFT adoption to Solana. $5000 in gas for a $300 mint 🤡

RARE @rarepoolADA

Gas on #ETH right now.... tell me again how this is decentralized and accessible for everyone.... #Cardano fixes this! #ADA

The last one is technically true, you can’t have gas fees if you don’t actually have functioning smart contracts…

Despite some pain at the pump, EIP-1559 is mostly proceeding as expected. Hopefully this provides you some peace of mind next time you’re forced to empty your wallet for an NFT airdrop.

𝕯𝖆𝖓𝖌𝖊𝖗 @safetyth1rd

High gas before EIP1559 "Godammit." High gas after EIP1559 "I'm ... ok with this"

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