Submit Blog Home » Cryptocurrency News » Cryptocurrency News » 0x Price Hits Two-Year High on Hopes Falling Ethereum Fees Will Spur DEX Trading 0x Price Hits Two-Year High on Hopes Falling Ethereum Fees Will Spur DEX Trading August 21, 2020
Aug 21, 2020 at 13:45 UTC Updated Aug 21, 2020 at 14:17 UTC
Hopes the bottleneck on the Ethereum blockchain might now ease have sent tokens associated with decentralized exchanges – known as DEX tokens – soaring, with the token of the 0x exchange (ZRX) rallying to a two-year high on Friday.CoinDesk data shows ZRX surged 40% from $0.61 to $0.97 – the highest level since October 2018 – in early morning trading.ZRX price action over past seven days Source: CoinDesk The rise comes just days after stablecoin provider Tether made plans to launch its USDT token on layer-2 scaling solution OMG Network and take some of the load off Ethereum.As most decentralized exchanges run on Ethereum, this is good news for the exchanges and their tokens.
For example, analysts hope Tether’s move will bring down average transaction fees, which recently reached a record high of $6 last week.Ethereum-based DEXs like 0x and also Kyber Network (KNC) are vulnerable to network congestion on Ethereum as high fees reduce trading activity.“Any reduction in ETH transaction costs due to tether’s migration on the OMG network is a huge win for DEX trading,” Denis Vinokourov, head of research for crypto prime broker Bequant, told CoinDesk in a Telegram chat.While KNC is only up by 3% it has also surged 900% year to date.
Other prominent DEX coins such as Aave’s LEND have gained 3,000%, while ZRX has increased by 300% YTD.ZRX may, therefore, be catching up with its peers as it still has plenty of ground to cover, Vinokourov said.
Glassnode data shows that as of Thursday, the mean fee per Ethereum transaction was $3.17 – significantly higher than the $0.55 seen in July.Ethereum transaction fees spiked to a new ATH last week Source: Glassnode It remains to be seen whether Ethereum fees will fall back to July levels – this uncertainty may help explain why the ZRX price has pulled back to $0.75 just as CoinDesk was going to press.
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