High gas prices are slowing down the growth of the NFT marketplaces and they could even leave Ethereum altogether just so they don’t have to deal with gas fees as we are about to read in the latest Ethereum news today.
High gas prices have become a huge problem for non-fungible token marketplaces especially as they want o mint at scale. Sean Papanikolas, the founder of the NFT marketplace Cargo, said that the NFT sector is right now at an inflection point but scalability weighs on new players in the sector that the gas prices have spiked as he said:
“Now, in 2020, platforms are starting to see the scaling issue now due to the spikes in gas prices. Some platforms have halted minting while gas is high and other platforms see a major decline in activity.”
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High gas prices caused some platforms to start working on the 2-layer solutions and some are even looking at other chains, considering leaving Ethereum altogether, as the Cargo founder warned. To counter the higher gas fees, Papanikolas said that Cargo launched a solution based on ERC-721 and ERC-2309. If blockchain companies expand their businesses within the NFT space, Papanikolas warned that it’s not going to be quite as easy:
“I think blockchain companies need to be prepared for the level of software engineering effort it will take to overcome the technical hurdles and the limitations of smart contract development on Ethereum and then how those pieces will work with traditional systems. The competition will continue to increase as well.”
The users can spend a small amount of Ether at current prices in order to secure the gas that can be used later without the risks of the prices going up. This is something that other industry players talked about in the past. The co-founder of Qtum and lead developer Jordan Earls said that this causes the network not to respond properly to an increase in gas prices like we can see today as some people that have access to these tokens can use this cheap gas now, but will also get their transactions highly prioritized without spending any ETH. Other companies also pointed out that NFT firms are exploring some other means of high gas prices.