Why is Mintable charging such high gas fees? We don’t, and here’s why.
Ahh, gas fees. The pesky little topic that causes a ruckus everywhere on the blockchain. Or so we thought. For those who are just dipping their toes into blockchain technology, this may seem like a major inconvenience, an annoying little splint that gets in the way of you minting or buying your NFTs, or worse still, creating your store!
Just to be clear, contrary to popular belief, the gas fees that you pay do not go into our coffers, and here’s why.
Gas — Keeps the blockchain going
To understand why gas fees are so high and volatile, we must first understand how blockchain technology works fundamentally.
In a traditional setup, if a business wants to store information on the internet, they will need to engage a centralized server. This can be in the form of building their own server farms to store their own data — a very costly endeavor — or engage in a service provider like Amazon Web Services (AWS). Regardless of the option chosen, the approach is the same here. We are basically uploading our information to a centralized server managed by a single entity. This comes at a cost, whether that is fees paid to your service provider for their hosting services or the capital you put in to build your own data centers.
We all know blockchain technology works a little differently by being decentralized in nature. A digital ledger that is distributed among a network of computers all around the world. And what that means is that instead of your information being stored in a single location, it is distributed among numerous nodes in the entire blockchain. Nodes form the infrastructure of a blockchain and they are connected to each other, constantly exchanging information to make sure all nodes stay up to date.
These nodes are run by what we, in the blockchain space call “miners”. In simple terms, they exchange their computing resources that run the blockchain for a small fee (coins). This is where the cost portion comes into play in blockchains. The gas fees that we pay for every transaction goes to these miners in exchange for their services of facilitating that transaction.
Why was yesterday’s gas fees $100 and $10 today?
Transactions on the blockchain work on a bidding system. It’s a constant tug of war between miners and users. If there is no activity on the blockchain, miners would be hungry for transactions to process, and therefore gas prices will fall. However, if there are lots of activity on the blockchain, transactions that bid for a higher gas fee would be prioritized over those with lower fees. This will create a snowball effect that will drive gas prices up.
Gas fees are also determined by the type of activity your transaction requests. The more computing power required, the higher the gas fee. For example, a transaction to send eth from one party to another is fairly simple and easy to execute and therefore would not cost much. But if you want to create an NFT store, you are essentially writing lines of code on the blockchain which requires more computing power and thus warrants a higher gas fee.
Gaming the system?
When gas prices soar, people would tend to start finding ways to game the system. The most common way you can do this is to raise your high-value transactions at a time where there is not much activity on the blockchain (Eg. Middle of the night).
While gas prices are something that is entirely out of our control, we try to build an infrastructure around our platform that enables creators to take advantage of NFTs with minimum friction.
Over the years, we’ve introduced features like Gasless minting (More on that soon), batch minting and the Mintable Gasless Store among others to help introduce the world of NFTs to the everyday person.