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Tuesday, September 22, 2020

TWO PONZI SCHEMES BECOME THE MOST GAS USERS ON ETHEREUM

 

 

Traffic within the Ethereum network is increasingly congested, this is further exacerbated by the operation of several ponzi schemes that consume more gas, making network congestion worse resulting in the rising cost of Ethereum gas.


Judging by the data according to the ETH Gas Station website, Uniswap and Tether rank at the top by consuming more than 25%-30% more than the other top 25 on-chain consumers.

 

 

The ponzi scheme, Forsage, followed in third place. The new Ponzi scheme "Contribute" also followed in fourth place. 


New Ponzi Scheme on Ethereum

 

Contribute with its governance token TRIB comes in as a new ponzi scheme on Ethereum. The project describes itself as a "decentralized coordination model" by incentivizing early investors to get more TRIB tokens, judging by the protocol white paper. 


No information regarding the composition of Liquidity Providers (LP) is published. In addition, details related to its creator Kento Sadim cannot be accessed online. Despite the absence of any details regarding the founder of the platform, there are other indicators that further corner the platform as a new ponzi scheme. For example, the "base price" of the token.


 

 

Like the "RegistrationExt" function on forsage ponzi schemes used to refer other users to register, the smart contracts used to claim TRIB tokens in Contribute also use that computing process. Plus it consumes a lot of fuel on Ethereum. 


By comparison, TRIB smart contracts consume more fuel than other complex transactions, as do Chainlink and 1inch.exchange. 


Preston Byrne, a lawyer at Anderson Kill Law, said Contribute could face charges from the Securities Exchange Commission with "fraud-related fraud with a prison sentence."


This ponzi scheme clearly hindered the growth of the DeFi space and tarnished the reputation of the crypto currency industry as a whole.


Time-Consuming Transactions and More Expensive Gas Costs

 

As seen, Ethereum has reached its capacity limit. If a few months ago ethereum transactions could have been done with only a few minutes, now these transactions can spend almost a full hour for just one transaction. In effect only "whales" can use and process transactions more quickly. 

 

 

Nevertheless, ETH remains the top choice in relation to the construction of DeFi-based platforms as there is a wide spread of ERC-20 token standards. Plus easy integration capabilities into many other blockchain protocols. Not only that factor, the release of USDT on the ETH network also makes the network now used in many other financial applications.


  These factors certainly provide their own problems with the growth of the Ethereum network. Moreover, more people are constantly waiting for scaling technology on this network.

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