The widespread collapse of the crypto market yesterday coincided with a drastic rise in transaction fees on the Ethereum network.
In particular, some users have seen their transactions in which they had paid up to $1,000 in gas (fee) not being picked by the crypto miners.
At its peak, traders were paying as much as 2,000 gweis in fees to send transactions to the blockchain of the second largest cryptocurrency, with the average at those times being between 1,500 and 1,700 gweis during a frenzied hour, according to data provided by digital asset research firm Delphi Digital.
Apparently, this abrupt increase in transaction costs was associated with settlements in the DeFi sector, which drove “gas wars amongst liquidators and arbitrageurs.”
Ethereum developer Anthony Sassano believes that the phenomenon was likely triggered by traders rushing to exit their leveraged positions.