On April 30th, Yuga Labs, the creator of one of the most popular non-fungible token (NFT) collections – the ‘Bored Ape Yacht Club (BAYC)’ – launched land sales for its much-anticipated metaverse project, the ‘Otherside’.
Yuga Labs Causes Major Spike in Ethereum Gas Fees
Within 24 hours, Yuga Labs generated more than $561 million from just the Otherside’s ‘Otherdeed‘ NFT sales. However, the massive NFT sales came with unexpected consequences; due to gas fees being paid in ETH, the frenzy saw Ethereum network fees spike to unprecendented highs.
At the sale’s peak, we reported that gas fees skyrocketed to $3,800, and as high as $6,500, while some users even reported seeing $14,000. Otherdeed was the biggest gas contributor on Ethereum, growing by more than 42,000%.
Yuga Labs Apologizes for Disrupting the Ethereum Network After Backlash
The event left community members unhappy, with Yuga Labs subsequently being accused of fraud, manipulation, and preferential treatment during the Otherside land sale.
Acknowledging the high gas fees and failed transactions experienced by users in light od the astronomical gas fees, Yuga Labs issued an apology. Yuga Labs shared on Twitter:
We're sorry for turning off the lights on Ethereum for a while. It seems abundantly clear that ApeCoin will need to migrate to its own chain in order to properly scale. We'd like to encourage the DAO to start thinking in this direction.— Yuga Labs (@yugalabs) May 1, 2022
On the Flipside
- The massive gas fees came with an upside, as the sale saw more than $200 million worth of ETH be permanently destroyed, pushing ETH issuance 18% into deflationary territory.
Why You Should Care
To help the project scale, Yuga Labs has proposed that ApeCoin be migrated to its own chain to avoid future disruptions of the Ethereum network.