Gas fees for Ethereum’s layer 2 Polygon (MATIC) surged more than 1,000%, peaking at $0.10 as users minted the Ordinals-inspired token known as POLS in large numbers.
In a November 16 (formerly Twitter) post, Polygon founder Sandeep Nailwal shared his surprise at the increase in online trading activity and suggested that the surge in trading volume may be due to the launch of new Polygon-based non-fungible tokens ( NFT ) series.
What happened @0xpolygon POS chain? There were 6 million transactions in the past 24 hours. Average 170 TPS. 1 million+ MATIC burned by the protocol. The chain is running smoothly, although the gas fees are crazy, there are no reorgs or 0 blocks etc.
I heard that there is a game “Baby Shark” coming soon, is that…
— Sandeep Nerwal | Sandeep. Polygon (@sandeepnailwal) November 16, 2023
The increase in network activity and the sudden spike in gas fees appear to be largely caused by the frenzied enthusiasm for minting new POLS tokens.
Dune Analytics data shows that the surge in POLS minting activity coincides with more than 102 million MATIC tokens (worth $86 million at current prices) being used as gas.
The POLS token is built on a protocol called PRC-20, which operates similarly to the BRC-20 token standard derived from Bitcoin Ordinals.
According to data from Ethereum Virtual Machine data provider EVM, only 8.7% of the POLS supply has been minted, with just over 18,100 owners claiming the tokens.
related: Bitcoin Ordinal Recovers from Binance Listing
As of the time of publication, Polygon natural gas rates have returned to typical levels, holding steady at around 882 gwei. Gas fees quantify the amount of computation required to conduct transactions on a given blockchain, and 1 gwei is approximately equal to 0.000000001 MATIC.
The Bitcoin network saw a similar, albeit longer, spike in activity in May following the release of the Ordinals protocol, which allows users to mint NFTs directly on the Bitcoin blockchain.
The ensuing craze for Ordinals NFTs and BRC-20 tokens led to Bitcoin fees reaching their highest levels since April 2021, a development that has traditional Bitcoin holders like Samson Mow and Adam Back arguing that NFT protocols and token standards are waste.
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