Ethereum's Growing Gas Crisis

The words of concern are warranted - because of changing conditions on the network, there's a possibility users of the startup's wallet software are overpaying for transactions.

In total, ethereum users spent 5,862 ether, or $2.7 million, to send transactions on Monday, an all-time high according to available network data.

"Gas prices not looking good right now," warned Eth Gas Station, a primary resource for ether gas metrics, on Twitter Monday, stating that users should pay $3.20 for a transaction to be accepted, or wait for periods of 30 minutes for that transaction to be accepted into a block.

What's because, while transaction costs point to a wider scaling issue there's steps that can be taken to improve costs before ethereum moves into a more scalable architecture.

As a result, it spurred token developers to send out airdrops to a multitude of accounts, sparking hundreds of thousands of transactions, a gesture that for many in the ethereum community was not well received.

The impact of this is numerous: transactions fees increase, transactions fail due to inefficient fees, and others, out of frustration or accident, send enormously high transaction fees- which drives up the price for everyone else.

"On the recent high gas fees I have to disagree with criticism regarding 'spam transactions,'" Georgios Konstantopoulos from Loom Network tweeted, "We're in a permissionless network. There are no spam transactions. If somebody pays the required fee, the is not spam."

Rather than transactions by the same account being processed separately, miners can sort transactions according to account, and claim a higher bounty by processing them simultaneously, which could be useful for "Super users," like exchanges, that send multiple transactions at once.

Founder of ethereum, Vitalik Buterin, has also authored a proposal, that simplifies the gas pricing algorithm, making it easier to predict what the correct gas price should be.

"The recent gas price surges are really only a reflection that the ethereum blockchain has been close to its maximum throughput for a while," Castonguay said, "It reflects that people have been using the protocol consistently and that ethereum needs to scale."