The number of tether transactions on the Tron blockchain has exceeded the number of Ethereum for three consecutive weeks as the fees for blockchain number two remain high.
The total weekly tether transactions on Ethereum have held steady at around 1.5 million over the past four weeks. At Tron, weekly transactions rose from around 900,000 in mid-December to nearly 2 million in the second week of January per year Coin metrics Data.
This recent trend is “mostly due to fees,” said Nate Maddrey, an analyst at Coin Metrics, in a message to CoinDesk.
At a price in US dollars, the average fee for an Ethereum transaction hit a record high of over $ 19 a week ago but is now just under $ 8. With a price in ether, the average fee is well below the all-time high but is still pretty high, topping 0.015 ETH several times this month, depending on data from Block chair.
“When the fees go up, [tether] Transactions tend to move from Ethereum to Tron, ”Maddrey said.
Notably, the total value of cables handled on Ethereum is still greater than on Tron, indicating that mostly smaller transactors are migrating. In the meantime, parties who can make larger transactions and presumably can afford higher fees appear to continue to use Ethereum.
“Given the increased cost of Ethereum transactions lately, it would be logical to use Tron,” said Paolo Ardoino, CTO of Tether.
Tron isn’t the only alternative for tether users. For the past two years, Tether has also launched on Algorand, Solana and Liquid Network with plans for even more integrations, said Ardoino. However, it is still open which network takes up the largest share of tether transactions.
Tether transactions that are heavily biased towards one or two blockchains wouldn’t be surprising, Maddrey told CoinDesk. However, the distribution of usage depends on “a combination of low fees, network effects and ease of use”.
Ardoino told CoinDesk that he expects Ethereum to “continue to play an important role for Tether in a few years’ time thanks to the Ethereum 2.0 migration, which should guarantee more throughput”.
However, he also expects other blockchains to “get a fair share of the total throughput”.