Gas Fee on Ethereum Skyrockets Due to ERC-404
The surge in the name of the experimental token standard ERC-404 has pushed Ethereum transaction fees to their highest level on February 9, 2024, reaching 377 Gwei. This figure has not been reached since May 12, 2023.
According to user X, alias PopPunk, one of the founders of the gas audit company Gaslite, ERC404 tokens use about three times the amount of gas needed for the average NFT transaction. Most of the network usage on February 9 came from a spike in activity on the decentralized exchange protocol Uniswap, where ERC-404 tokens can be traded.
Understanding ERC-404
ERC-404 aims to bind non-fungible tokens (NFTs) ERC-721 to ERC-20 tokens. ERC-404 allows the purchase of one whole token to produce one NFT. This scheme is expected to increase the utility of NFTs and their widespread adoption in trading.
Although the prefix "ERC" is attached to tokens of the new generation, the name is highly unofficial. Speaking to Cointelegraph on February 9, one of the developers behind the Pandora project, one of the early ERC-404 projects, who uses the alias "ctrl," said the team is working to "drastically reduce" fuel costs.
"We are trying to optimize gas usage because it is a big part of adoption and protocols that want to be integrated [...] So in some cases, we could potentially reduce fuel costs by around 300% to 400%," he said.
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