Ethereum Adoption Hits an All-Time High

Decentralized Finance has been a huge topic over the last few years, with lending, staking, insurance (and more) steadily making waves in the financial sector.

Blockchain technology has unlocked features and reduced overhead on products allowing for better interest rates and returns on investments. This alone has caught the eye of many crypto-asset holders.

Smart contracts are applications on the blockchain. Each smart contract has an owner and has a set of functions.

Once a smart contract has been uploaded to a blockchain it can never be changed. The immutability of smart contracts leads to great decentralization but comes at a cost – an inability to adhere to security updates.

A majority of these smart contracts are hosted on the Ethereum network. The network has so many of these that it struggles to keep up, thus the cost of transactions continue to soar.

At the time of writing, sending a token on the Ethereum network costs roughly $50 per transaction, while a larger smart contract operation can cost up to $120.

Many continue to trust in Ethereum as it has proved its success in standing the test of time. The open-sourced blockchain has remained active (and has never been shut down), neither has the main chain ever been hacked.

Also on the horizon is the Ethereum 2.0 merger which could see transaction speeds reach 1000 times the current level. This would effectively eliminate the high transaction fees. 

In order to interact with a smart contract, one must send Ethereum through the contract where it will stay until the operation is complete.

Uniswap is the world’s largest decentralized blockchain exchange which works by users staking billions of dollars worth of assets onto their smart contracts to be used for liquidity.

In return, users gain a portion of the fees associated with trading. Other contracts such as AAVE, a lending platform, allow users to stake their Ethereum in their smart contracts to gain interest or to be used as collateral for loans.

Glass Node is on-chain market intelligence that aims to bring clarity to blockchain data. Its latest statistics show that roughly 28% of all Ethereum in existence is locked into smart contracts.

This is the highest adoption rate ever seen for the Ethereum blockchain.

The more Ethereum is staked into contracts, the less there is available on the open market. With rising demand and a shrinking supply, the price of Ethereum has been increasing most of the year. 

This is a great trend for crypto enthusiasts who hope to see more adoption, utility, and demand in the years to come.

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Written by Isabella Aslam

Reporter

Isabella is an experienced writer in B2B and B2C journalism. Alongside crypto, Isabella writes and discusses the topics of relationships and psychology. Isabella holds a first-class degree in music journalism and often interviews electronic artists and DJs.

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