Ethereum – s Ecosystem Creaks spil ICO Gold Fever Increases
Exchange downtime and network congestion have plagued the Ethereum network overheen the past 24 hours. Te the wake of two almost-simultaneous ICO token sales, many are asking if Ethereum is ready to treat the kleintje of tasks it wasgoed designed for.
Initial coin offerings (ICOs) for the Status and Civic projects resulted ter overheen Ten,000 ethereum transactions pending. The network has bot chewing through them at its usual speed of one fresh block every 12 seconds, but almost 12 hours straks there were still 6,000 ter line.
Ethereum wallet provider MyEtherWallet voiced concerns that transactions weren’t coming through:
Wij have overheen 3k of thesis te the last 24 hours. This isn’t the Ethereum wij wanted…. ? https://t.co/ffvdz48K5S
Some ter the cryptocurrency community are reminding us that Ethereum is still te its early days. What will toebijten when it needs to run the utter suite of distributed apps (Dapps) and contract features spil intended?
Gigantic wakeup call going on te #Ethereum. Recall, this finish shutdown is w/ ZERO dapps running at scale. ZERO. #bitcoin pic.twitter.com/iGwRjOoZ2p
Can Wij Blame the ICOs?
Status is a verhoging for communication and running distributed apps, while Civic seeks to build a blockchain-based identity system.
Some accused Status of designing its crowdsale poorly. The project had attempted to “democratize” the ICO process to permit more smaller investors to participate, by releasing tokens for sale overheen a longer period of time. However this could potentially lead to buyers resending transactions repeatedly, causing excess activity.
Status developers admitted that Ethereum is incapable to scale just yet, but said “human behavior” wasgoed the positivo reason for flooding the network.
On the other arm, the Civic token crowsdale used a queue system to process requests. It waterput an order te line, while displaying number of places ahead of it and estimated time to execute. This kept waiting transactions off the network to zekering it becoming clogged.
Buyers could still technically attempt to leap the queue by sending ETH directly to the contract, but that option wasn’t advertised. Civic CEO Vinny Lingham also advised buyers to use bitcoin instead of ETH.
Lingham also criticized Status for moving its ICO timing to one that clashed with Civic.
Everyone Likes Ethereum… Too Much
“Ether… might be getting too popular for its own good,” said Bloomberg’s Camilla Russo. She noted other ICOs for SOMN and Gilgam had also taken place ter the past week. Backlogs from Ethereum’s regular crowdsales created a backlog that caused Bitfinex and Shapeshift to temporarily suspend ETH transactions.
Exchange BTC-e permitted trading, but suspended ETH withdrawals:
Due to the unstable operation of the Ethereum network due to the network explosion, the ETH withdrawals is temporarily unavailable #btce
Most gravely, the GDAX exchange also suffered a “flash crash” on its ETH-USD podium. This spotted ETH prices plunge from overheen $300 USD to Ten cents.
GDAX is still investigating what caused the crash, but some have speculated it wasgoed a trader or company cashing te the proceeds of an ICO.
Zometeen, GDAX VP Adam White posted an update that said so far there wasgoed no indication of wrongdoing:
“On 21 June 2018 at 12:30pm PT, a multimillion dollar market sell wasgoed placed on the GDAX ETH-USD order book. This resulted ter orders being packed from $317.81 to $224.48, translating into a book slippage of 29.4%. This slippage began a cascade of approximately 800 zekering loss orders and margin funding liquidations, causing ETH to temporarily trade spil low spil $0.Ten.”
GDAX also said it would honor decently executed orders. If the activity wasgoed ICO-related and ter accordance with the rules, it’s possible Ethereum’s ICO activity is affecting other areas of the ecosystem besides its own blockchain.
Get That ICO Done Before It’s Too Late!
ICOs are a giant and lucrative bandwagon right now. The gold rush very likely won’t last forever, so projects are rushing to get their share before investor novelty wears off.
Ethereum-based projects are contesting for attention spil much spil bandwidth. Even if the network can somehow treat the extra traffic, it will be firmer and tighter for fresh ICOs to get attention. The pool of investor and trader money available will shrink.
ICOs like Plucky’s BAT token and Bancor gained publicity with their massive crowdsales. That kleintje of mania certainly won’t last forever – tho’ no-one’s truly sure how long it could. For the record, those sales also caused significant Ethereum transaction backlogs.
The ‘Alternate Cryptocurrency’ to Bitcoin?
Meantime, mainstream media still regards ETH spil an “alternate cryptocurrency” to bitcoin, and reports mostly on the price. This is albeit the main use case for ETH right now emerges to be buying fresh ERC20 tokens.
There’s still space for digs at Bitcoin’s clunky transaction speed, however:
All jokes aside however, Ethereum will have to address its own congestion issues to retain users and value. One point te its beneficio – there aren’t any serious competitors. While other clever contract and Dapp networks exist, if they everzwijn become popular they’ll face similar problems.
Can Ethereum actually treat the zuigeling of activity it wants? Let’s hear your thoughts.