The entire Ethereum network is reportedly suffering backlogs due to the Brave browser BAT token sale. It suggests that network congestion isn’t a problem unique to Bitcoin.
Exchange ShapeShift put out a support notice saying “If you’ve submitted an ETH or ERC-20 transaction, please be aware it may not be posted to the Ethereum blockchain for several hours.”
Bitcoin users were quick to pounce on the notice. After all, several cryptocurrency fans have touted Ethereum and ether as a flexible alternative to Bitcoin, thanks to backlogs caused by Bitcoin’s 1MB block sizes.
Ethereum backlog, you say? Couldn't be. No chance! What about all the people who switched from Bitcoin because of tx-fees and the backlog! ? pic.twitter.com/9lbutxuL7s
— grubles (@notgrubles) May 31, 2017
ShapeShift’s notice added that such backlogs will be possible whenever there’s a ERC-20 token sale on the Ethereum network. In the future, that could be quite often.
ERC-20 tokens are digital asset tokens created on Ethereum, usually for specific applications or initial coin offerings (ICOs). They are distinct from Ethereum’s native currency ether (ETH), which “fuels” transactions on the network. 1 ETH is currently worth around $220 USD.
Brave and the BAT Token Sale
Today’s offering was Brave’s Basic Attention Token sale. The Brave browser project has received a lot of attention in the cryptocurrency community since it launched its first beta, with its ad revenue-sharing technology and integration of digital currency services.
According to the ICO website, the BAT token “can be used to obtain a variety of advertising and attention-based services on the Brave platform”.
The BAT ICO was fast — a sell-out in under 30 seconds, in fact. It raised $36 million USD for the project, with half the tokens reportedly going to just five addresses. The remainder were shared between another roughly 200 addresses.
While the Brave project was reportedly happy with the results, some potential investors were annoyed at missing the chance to jump in.
However hours after the ICO finished, Ethereum’s blockchain was still catching up. Although the transactions were broadcast to the network, the blockchain itself still had around 2,000 in the queue several hours later.
Ethereum is designed to confirm a new block every 12 seconds. That’s significantly faster than Bitcoin’s 10 minutes, leading some to tout Ethereum’s superiority over Bitcoin. Some have suggested Ethereum will even supercede Bitcoin if Bitcoin can’t sort out its scaling issues soon.
While ICOs are special events, they may become commonplace as Ethereum grows. If users experience hours of congestion and stalled transactions every time someone sells a token, it could dampen those cries of superiority.
Bitsonline will continue to monitor this developing story.
Are you an Ethereum user? What do you think about ICOs slowing the network? Let us know.
Images via Brave, Pixabay