Uniswap Founder: Dapps Will Soon Handle Gas Fees On Behalf Of Clients
March 04 2024 - 4:00PM
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In comments likely to resonate with crypto fans, Hayden Adams, the
founder of Uniswap, a leading decentralized exchange (DEX),
predicts that network fees will eventually become a background
expense for users, much like server costs are today for top
centralized applications running on Amazon Web Service and other
platforms. Gas Fees Is A Major Pain Point, Mass
Migration To Solana, Layer-2 Platforms Taking to X,
Adams envisioned a future where decentralized
applications (dapps) seamlessly cover network fees on behalf of
users. This approach, the inventor adds, aligns with how server
costs are currently handled in the current setup, especially among
operators of common applications like X or Facebook. Server costs
are often considered a hidden expense in the overall business
model. However, this can cost millions of dollars monthly,
depending on the app’s popularity. Related Reading: Shiba Inu
Blasts Into Top 10 Crypto Following 175% Price Surge Presently, the
dream of low-fee transactions remains out of reach for some
blockchains, particularly Ethereum, the dominant platform for smart
contracts. Ethereum is a legacy blockchain that recently shifted
from a proof-of-work to proof-of-stake consensus. However, while
this was a major shift, the network still struggles with scaling
challenges. At optimum, Ethereum can only process 15 transactions
every second. Comparing this with current demand only means “gas
fees” must be high to incentivize the validator to include
transactions in the next block. This high “gas fee” continues to be
a major pain point, leading some projects to migrate to alternative
networks with faster transaction speeds and lower fees. Solana, a
high-throughput blockchain, and layer-2 scaling solutions like
Arbitrum have emerged as popular destinations for these migrating
projects. This trend is particularly evident with the recent surge
of meme coins like BONK and WIF, which have seen significant growth
on Solana. Related Reading: Bitcoin Crossroads: Analyst Identifies
Level Set To Determine Next Move Unlike Ethereum, Solana and
layer-2 platforms relying on Ethereum for security boast higher
throughput and negligible gas fees. Accordingly, more meme coin
projects are launching on these networks. Here, users can transact
without considering the implication of gas fees. In recent weeks,
top meme coins, besides PepeCoin (PEPE) or Dogecoin (DOGE), have
been launching on Solana. Ethereum Is Working On Scaling Ethereum
will implement the Dencun Upgrade in mid-March to combat its
scaling woes. The update aims to reduce costs for users interacting
with layer-2 solutions significantly. However, this upgrade is just
one of the many Ethereum developers plan to implement over time.
Eventually, the proof-of-stake network aims to scale processing
speeds, allowing it to execute millions of transactions every
second through innovations like Sharding. Uniswap continues
to lead in popularity, looking at assets under management. So far,
Uniswap developers have deployed its solution across other
blockchains and layer-2 options, including Arbitrum and the BNB
Chain. Feature image from Shutterstock, chart from TradingView
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