The entire digital currency space has reached a new milestone after ethereum processed half a million transactions within a 24 hour period, an all time high for any decentralized public blockchain.
A milestone that suggest ethereum is experiencing a considerable increase in adoption and utility, with transaction levels rising from mere thousands last year to now hundreds of thousands a day.
Yet, their safe low cost transaction fees remain below a penny at $0.007 according to data provided by ethereum’s gas station, even while transaction volumes significantly pass those of bitcoin, which enjoys fees of $7 at times.
That’s a recent development for bitcoin as shown by the interesting graph below. The currency used to operate finely with low fees until earlier this year when demand skyrocketed, yet Bitcoin Core developers left capacity unchanged.
Ethereum still has plenty of capacity, but at this rate it may too hit a ceiling if scalability upgrades continue to be delayed.
However, in a few weeks, the currency will see a simple capacity increase through the Metropolis hardfork which will return blocks to an average of 12 seconds from the current 24 seconds.
Block times have risen because of the difficulty bomb placed in the protocol by developers so as to give the network no choice when it comes time to upgrade to Proof of Stake (PoS).
However, PoS is far behind, so that exponential difficulty increase has to be postponed during the Metropolis Hardfork, thus in effect increasing the networks capacity.
They both are an addition to the network, an external layer you can tap into if you please. Aiding with on-chain capacity in an indirect way as projects like Etherdelta, the decentralized ethereum exchange, may choose to use those protocols instead of the public blockchain directly.
However, no such second layer protocol has yet been seen in operation so we can not quite objectively say how exactly they would affect capacity. With on-chain demand probably continuing to increase and might perhaps hit a ceiling next year.
The race thus is on for the biggest prize in this space. A truly scalable public blockchain.