As an analyst with years of experience in the cryptocurrency market, I’ve seen my fair share of ups and downs, bubbles, and busts. The recent surge in blob fees due to the Scroll airdrop is yet another reminder of the wild ride that this industry can be.
A frenzy of airdrop claims for a new Ethereum layer-2 network called Scroll briefly drove up the cost of blob fees as high as $4.52, marking the third time that blobs have become costly since Ethereum’s Dencun upgrade in March.
In a recent post on platform X, anonymous crypto data analyst Hildobby stated that claimers of the airdropped scroll have sparked activity in the blob market, implying that these items are no longer available for free.
He blamed the uptick in blob fees on an airdrop for Ethereum L2 Scroll, which listed its governance token SCR on Binance and airdropped the token to its users on Oct. 22.
According to data from Dune Analytics, blob fees reached a four-month high of $4.52 on Oct. 22.
A significant increase in the cost of blobs occurred only two times previously: firstly, during an upsurge of L2 activities in July, and secondly, at the debut of the Blobscription protocol on March 27, which enabled users to write data directly onto blobs.
Increased transaction fees for Ethereum can be both beneficial and detrimental. On one hand, they lead to increased returns of gas for the network due to more expensive blobs. On the other hand, they also cause an increase in costs related to executing transactions and transfers on Ethereum Layer 2 solutions (L2s), as these expenses rise.
As a crypto investor, I’ve noticed a significant drop in the price of Blob fees due to a slowdown in activity on Layer 2 solutions. At the time of writing, these fees have stabilized at a cost almost negligible, nearing zero.
It comes just a month after Ethereum co-founder Vitalik Buterin stressed in a Sept. 27 X thread that the “blob count” — the maximum amount of available blobs per block — was nearing full capacity and could soon stall scalability for Ethereum if measures were not taken to address it.
Approximately weeks past, on October 18th, the Ethereum development team unveiled a novel Ethereum Improvement Proposal (EIP). This EIP aimed to enhance the current limit for the “blob count”, which refers to the maximum number of blobs that can be found within each block.
As per Galaxy Digital’s Vice President of Research, Christine Kim, EIP-7742 proposes a system that allows Ethereum’s consensus layer to adjust the gas target and maximum values for blobs on-the-fly. This setup is designed to prioritize transactions carrying blobs and enhance network scalability during the forthcoming Pectra update, aiming to make the network more efficient.
In March, blobs became a part of the Denme upgrade within Ethereum. This enhancement was mainly designed to lower transaction fees on Ethereum’s secondary layers.
After the implementation of blobs and proto-danksharding, the cost of transactions on Ethereum Layer 2 significantly decreased. Transaction costs on Arbitrum went down from approximately $1.25 to under $0.02, while fees on Polygon experienced a similar drop.
Significantly, Ethereum programmer Dan Cline recorded the full Bee Movie script onto the Ethereum primary network, spending only $14. This action illustrates one of the benefits of blobs as short-term data storage solutions – affordability.
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2024-10-23 05:16