High gas prices affect all dapps and not just Gitcoin.

Gitcoin is a decentralized app for value creation & value capture. It is built upon the Ethereum network, and the solidity smart contract programming language.

What is Gas ?

Gas is the payment that is sent to the Ethereum node operators (also called miners), in exchange for execution of a smart contract.

Why does the gas price matter to me if I’m a developer on the Gitcoin platform?

If you’re a bounty hunter on the Gitcoin platform, you’re probably submitting finished development work to earn money (we call this “claiming the bounty”). In order to do that, you need to submit your work and have a fulfillment transaction posted to the Ethereum network. Of course, for anything to make its way on to the Ethereum network, you’ll have to pay an execution fee — gas. Pay too little, and miners don’t have adequate incentive to process your transaction, so other transactions in the pool submitted with higher gas fees float to the top. Pay too much, and well, your transaction gets picked up quickly, but you pay the price, adding to the costs of fulfilling a bounty. More costs means less profit from your work.

A good gas price strikes a balance between what will get your transaction processed in a timely manner (good work shouldn’t wait), and what is an acceptable amount to pay in relation to the bounty. For example, a gas price of $5 for a bounty of $15 is unacceptable. A gas price of $5 for a bounty of $1000 is more reasonable.

What is happening to the Gas price from last couple of days?

The main reason fees are so high is because of deliberate network spam designed to drive up fees at enormous (to most) cost to the spammer. So someone’s poured a reasonable amount of effort and about US$15 million equivalent into raising transaction fees on the Ethereum network.

So what happened was, 7 days ago(July 15th) [Team JUST Discord] noticed that 40% of the ethereum’s network was used by this contract. A beautiful and innovative copy-paste of a default ERC20 standard token called “IFishYunYu” with no features. (So it does nothing.)

Yet miraculously, it seemed tons of “unique” accounts were transferring massive volumes of this token constantly, almost 50 ETH of gas an hour was being steadily used for nearly 24 hours then just to transfer individual tokens to the Fcoin exchange. You can see the increase in gas price.

See the spike on around 15th July.

But of course that exchange was just a red herring to distract us from what was really happening.

The creator of this contract was transferring billions of Ifish tokens from his account to another account and then from that account to multiple accounts, splitting it into 500–600 accounts.He was doing this by using bots which basically transfer tokens from one account to multiple accounts and then from those multiple accounts to a main account.You can check this by following any transaction, you will come back to the root node.

See this thread on reddit where people are discussing about this.

Now why they are doing this?

Interesting things to come to light involves a random exchange. This exchange apparently has come up with a indigent voting mechanism. Basically, they want their users to “vote” for tokens to be listed. Instead of a traditional voting mechanism they have decided to vote via “Cumulative deposit number ranking” which means One deposit is equal to One vote.

Unsurprisingly, people who are financially incentivized to get a incompetent token listed on a exchange are sending these tokens in bulk to separate accounts on the blockchain and then to separate accounts and thus resulting in the network congestion & high transaction fees that we’ve experienced these past few days.

One of the tokens(F Coin) that was listed is not a legitimate token. The token is literally a scam-token capitalizing on the symbol of a real, highly-anticipated token that recently ICO’d but hasn’t distributed yet.

“When gas spikes like this all crypto games lose 50% to 75% of their daily active users. At the moment we are just kind of riding it out as an industry”-:Founder of Cryptocity

This is just plain sad, an attack is an attack even if it’s working as per the rules of the platform.

How can a bounty hunter use this information to his/her advantage, and make better decisions regarding submitting bounties ?

When you submit your work to the Ethereum network (example above), you will be asked to input a gas price for the transaction. In most cases, the gas price will be prefilled for you, but you can also override it to make your transaction confirm quicker (more gas) or cheaper (less gas).

Don’t submit your work if the gas price is high, wait for it to come down a little bit. There is no point in giving 20–30% of your bounty to miners. So just keep refreshing gas guzzlers page and submit when the time/price is right.

Conclusion

I wish Gitcoin best of luck for their future. It’s a great platform for funders, developers(like me).

“Work hard for what you want because it won’t come to you without a fight. You have to be strong and courageous and know that you can do anything you put your mind to. If somebody puts you down or criticizes you, just keep on believing in yourself and turn it into something positive”.

Thanks for reading this article. Any feedback is appreciated.