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Today's winner:Hermez Network to fix Ethereum gas fee issuesKamsi King
Hermez Network has launched its mainnet. The network hopes to reduce Ethereum gas fees by collapsing several transfers into just one transaction. With the rise in the popularity of Ethereum blockchain, traffic has skyrocketed and so has the gas fees. This has forced some users to start considering a few alternatives, notably Binance Smart Chain.
Investors generally would opt for decentralized finance (DeFi). One of the main attractions of DeFi was its low transaction fees. Sadly, Ethereum appears to be clearing out profits due to its high gas fees. To solve the Ethereum gas fees problem, Hermez Network has come up with a couple of solutions.
Presently, every single transaction attracts a fee, regardless of the size of the transaction. Most of the transactions can be made to occur at the same time, resulting in increased transaction cost. What Hermez Network does is to compress several thousands of these transactions in batches. This is expected to cut ETH transaction fee by as much as 90%. In doing this, Hermez would not be adding to the processing burden of the network.
Users on the Hermez Network can verify transactions and place them in batches using a hardware. These transactions that have been batched can now be stored on Ethereum’s blockchain.
Whoever gets to process the transactions is usually determined in an auction where the coordinators bid. Bidding is done using HEZ, the native token for the Hermez Network. Whoever wins the bid is given a 10 minutes time window to handle as many transactions as they can. At the end of the transactions, the transaction fees are awarded to the coordinator.