- Gas fees on the Base have reached pre-Dencun levels.
- A handful of traders are behind the sudden surge.
- Memecoins appear to be the main culprit behind the high prices.
Ethereum marked history this month, rolling out its highly anticipated Dencun upgrade to the mainnet, much to users’ excitement. The upgrade was set to mark a major step in the network’s scaling vision, promising to immediately scale up Layer-2s such as Base and usher in a new era of use cases.
Initially, the upgrade held up to its promise, significantly decreasing gas on Base by 99% and propelling daily transactions on the network fivefold. However, gas fees went up before the L2 could benefit from the exceptionally low fees and subsequent network activity.
Bots Drive Up Base Gas Prices
Ethereum’s Dencun upgrade greatly rekindled excitement within the Layer-2 ecosystem and propelled platforms like Base to new heights thanks to the low-fee guarantees.
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Before Dencun, Base hosted about 440,000 transactions every day. However, this number increased to two million following the upgrade. With growth on the network showing no signs of slowing down, the network was poised for more.
However, things quickly took a turn as gas fees surged 2000% on March 20, peaking at an average of $2 in the face of network congestion. While fees quickly dropped back to their normal $0.2 threshold amid calmer activity levels, they picked up again on the weekend, hitting $1.9—an 1100% increase.
Interestingly, while Base’s fees endured a rollercoaster of fees, gas on other layer-2 networks such as Arbitrum, Optimism, and ZKsync remained relatively consistent, staying below $0.001.
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Data sleuth Michael Silberling quickly noticed the discrepancy, linking it to three anonymous contracts engaged in high-frequency memecoin trading. Silberling notes that much of the rush on Base stemmed from automated actors targeting memecoins, likely arbitraging and setting higher than usual gas fes for priority.
According to the expert, the influx of trading bots on the network translated into higher demand and prices for meme coins on Base, leading to high gas fees.
On the Flipside
- Memecoins have garnered much hype recently, surging as high as 100%.
- Despite the promise of blobs, some experts have cautioned that Layer 2 fees may rise again as more chains jump in and the blobs fee market becomes more saturated.
Why This Matters
The surge in Base’s gas fees highlights how larger wallets can manipulate prices on the network by artificially boosting demand with trading bots. Despite the Dencun upgrade’s goal of scaling up Layer-2s by reducing fees, Base’s case demonstrates how bots can quickly undermine its impact.
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