The use of flashbots instead of PGA bots has led to traders being able to force the average gas fees down to around 65 gwei from the typical 120 gwei of just a couple of days ago.
According to a post by u/Set1Less on the Reddit r/CryptoCurrency forum, the usual PGA bots are now unable to compete with the new flashbots, and now 58% of the hashrate is being realised in this way.
The post outlines how PGA bots actually increase the fees paid by those transacting on the Ethereum blockchain, while flashbots have the opposite effect of reducing fees.
A short description of how PGA bots work is as follows:
“PGA means Priority Gas Auction. It’s when arbitrage bots monitor their competitor’s transactions and keep bidding up the gas against each other. While the traders can get their transaction higher up in their priority list, this keeps the gas fees on mainnet up high arbitrarily.”
With Binance Coin having its huge, parabolic surge over the last few days, this is definitely some good news for Ethereum and its on-going issues with such high fees. An average of $50 per transaction in comparison with just a few cents on the Binance Smart Chain has led many traders and projects to transfer their transactions and platforms across chains.
However, now that gas fees have effectively reduced by around half, transactions on Ethereum should become a lot easier to stomach. Approaching Berlin and London hard forks should also help matters. A forum user had this to say about the “short term” success of BNB:
“Kudos to Binance for emulating Ethereum in the short term, but if gas prices come down significantly, I don’t see BNB maintaining this success. Who would keep their coin on a centralized chain without an overwhelming value prop? Ultimately, the trust that any successful project would have to have in Binance to continue acting in their best interest goes against the principles of crypto, and sensible business practices.”
Source: Reddit user spartan_green
The same forum user went on to say this in the thread:
“Binance chain is a clone of Ethereum without an equivalent development community, so if/when it doesn’t have a distinct pricing advantage I fail to see how it’s a viable project in the space. It will continue to clone each new ERC-20 project, but who is the audience?
In my very limited opinion, BNB is basically McDonald’s Bucks. It’s airline miles for a centralized crypto exchange. As long as you’re not the last one holding the bag, it might be a great investment. But if you are, I wouldn’t expect CZ to bail you out.”
With layer 2 solutions gaining in use and popularity, transactions on the Ethereum blockchain may well be liveable into the short and medium term. The main solution of the full implementation of Eth 2.0 is still a long way off though, so it remains to be seen just how much traction competitors like Binance, Cardano and Polkadot can make in the meantime.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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