It should be noted that there are usually no performance issues on the Etherium network, meaning that the blockchain consistently adds new blocks and users successfully conduct transactions. However, not everyone in the cryptocurrency community is unequivocal about what is happening. Some believe that at a time when fees are rising significantly, the network is becoming unaffordable for most users who cannot afford to transact. Consequently, there is supposedly no problem with the blockchain’s functionality.


The last time a large-scale fee hike occurred in Etherium was last week. Specifically, at the time, it cost approximately $15 to transfer USDT tokens, while exchanging assets on the decentralised Uniswap exchange cost around $50.

At times, the network asked for almost a thousand dollars for NFT minting, as shown below, but on the whole there were few such moments.


Amusingly, the topic of high commissions has previously been touched upon by the creator of Etherium, Vitalik Buterin, among others. In April 2018, he commented on a discussion during the Deconomy conference on his Twitter. During the discussion, the topic of high fees in blockchain came up between the participants of the dialogue – and Vitalik commented on them as follows.

By the way, I am on Roger’s side here. Commissions of $50 can de facto be considered a vital failure.

A vital failure is a state of the system in which it is unable to continue its development due to high user activity.

Accordingly, what has been happening at Etherium over the past week cannot be called a normal occurrence. And Vitalik would agree with that as well.

Why is Etherium not working?

Around midnight today, there was a sharp drop in confirmed transactions – as much as 40 per cent – between epochs 200,552 and 200,554. To recap, in the case of Etherium, an epoch is a period of 32 slots during which validators offer and validate blocks. Slots are 12-second periods of time in which blocks can be added to the network.

Note that finality in the blockchain world refers to the period of time after which a transaction is considered to be conducted and final, meaning that it can no longer be undone in any way. This is an important parameter that varies depending on the blockchain chosen.

Note the following screenshot. Here there is a negative parameter opposite the finality of the five epochs, which means that the network has been experiencing problems for just half an hour. This is bad news for blockchain users who wanted to conduct a transaction during this time period.

Representatives of the ethereumpools.info platform noted on Twitter that during the aforementioned period of unknown error, almost every pool or operator on the network “went offline”, meaning that it was not following the finalisation process correctly.

According to CoinDesk’s sources, the problem ended up going virtually unnoticed by the average Etherium user. The fact is that during this time, transactions were sent without a hitch and smart contracts performed their functions. However, the failure in the finalisation process was dangerous in that it posed the threat of blockchain changes and transfer cancellations in a targeted attack on the cryptocurrency’s blockchain during this time period.

Today, Ethereum Foundation developers are searching for the cause of the problem. As analysts point out, the Ethereum network after the transition to Proof-of-Stake should have resisted such bugs, but this time the problems still occurred.

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An important Shanghai upgrade was also activated on the Ether network in mid-April, allowing ETH to be withdrawn from the deposit smart contract for Staked. Analysts at the Staked platform believe that Shanghai will cause a wave of popularisation for steking over the next eighteen months, reports The Block.

In a report published the day before, experts said there was a 6.5x increase in ETH shipments to steaking compared to April. As a reminder, in order to get a validator role on the Etherium network, you need to deposit 32 ETH into the stack. We wrote about this process in more detail in this piece.

According to the Milkroad platform, the average profitability of an Etherium staking ranges around 7 percent annually. Here is the relevant table.

We’ve clarified the current data: today, there are 19.81 million ETH in Efirium Stacking. This is a record-breaking figure, which speaks to the high security of the blockchain. Still, the more coins blocked by validators, the more assets, in theory, an attacker would have to spend to potentially create problems.

Sending coins into stacking affects, among other things, the number of Ethers available on exchanges. According to the Santiment platform, there is now 10.1 per cent of all ETH in circulation on trading platforms. This figure is the lowest since July 2015.

Analysts also add that the outflow of coins from trading platforms is also fuelled by the growing popularity of non-custodial storage of digital assets – that is, using the hardware wallets we are already familiar with.

Meanwhile, amid high fees due to blockchain congestion, ethers continue to be actively burned. More than 137,000 ETH have been burned in the last month, with the total number of ethers down by 221,000 coins since the blockchain moved to Proof-of-Stake in September 2022.


We believe that the overnight incident is hardly good for Etherium's reputation. And although it had no effect on the safety of ETH investors' assets, the prospect of it affecting blocks already offered and created is unlikely to please. So in this case we can only hope that Ethereum Core developers will be able to identify the source of the problem and fix it, and there will be no more such cases in the future.


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