Cryptocurrency trading firm Bitfinex spent almost $24 million in a single Ethereum transaction. According to the block explorer Etherscan, Bitfinex completed the transaction today. An exchange called Bitfinex made the transaction, while Deversifi, a non-custodial exchange split out from Bitfinex in 2019, received the funds.
The tether was transferred to one wallet before being handed on to Deversifi’s wallet via a smart contract interaction. To make Ethereum costs more predictable, the transaction type utilized was the recently implemented EIP-1559.
A $24 Million Gas Calculation
It was part of a block created by an Ethereum miner who has not been identified but is among the top 10 producers of blocks in the past seven days.
Ethereum transaction fees are notoriously difficult to calculate. Two significant transactions totaling $5.2 million in fees were completed in June 2020.
How Ethereum Gas Works
Gas is the charge or pricing value needed to complete an Ethereum blockchain transaction or contract effectively. Small fractions of the cryptocurrency ETH are used to price the gas, which is also known as gwei and nanoeth.
The gas is used to distribute Ethereum virtual machine (EVM) resources so that decentralized applications like smart contracts may self-execute in a safe yet decentralized manner.
When the gas price falls below a certain level, network miners will refuse to execute the transaction, and this will result in a lower gas price for network users seeking processing capacity.
EIP-1559’s Fundamental Change to ETH Gas
With the Ethereum EIP-1559 update, the method for calculating gas changed. EIP-1559 essentially substitutes the first-price auction with a fixed-price sale. There will be a ‘base fee’ clearly stated in the next block, so users making transactions won’t have to guess as much about how much gas is needed.
Users or apps may give a “tip” to the miner to make their transaction more important. See how EIP-1559 will affect Ethereum in greater detail by reading this article.