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A sharp spike in gas fee on Ethereum; is Russia-Ukraine conflict to be blamed

A sharp spike in gas fee on Ethereum; is Russia-Ukraine conflict to be blamed

As Russian bombs fall on Ukraine and reports of deaths are coming in, the international community has been struggling to mobilize resources and send funds to various organizations in order to support Ukraine’s army. For that reason, it might not surprise many to know that there’s already an NFT collection aimed at fulfilling this need.

Do-NATIONs and more

A self-described “Web3 initiative” – RELI3F UKR – has been selling NFTs with the promise that all proceeds from primary sales will go towards relief efforts in Ukraine, along with some secondary sales proceeds. According to OpenSea, the floor price was about 0.053 ETH and at press time, the trading volume was about 456 ETH.

But here was the catch. As is the case with many popular NFT projects, the frenzy of interest triggered an astronomical rise in gas prices. Early morning on 26 February, the median gas price shot past 1,300 gwei, before dropping back down to below 100 gwei.

For its part, RELI3F appeared to pat itself on the back, and tweeted,

“And we are sold out. 0.05 eth x 37 artists x 200 editions = 370 eth. Over a million dollars raised for the people of Ukraine in 30 seconds. This is the power of web3. From the bottom of our hearts, thank you.”

While impressive, many donators were disappointed by the money they lost on gas fees, claiming the funds could have gone to the Ukrainian people instead.

Crypto donations have been a popular option for those who want to financially support Ukrainian relief groups or even the military. One estimate reported that more than $4 million had been sent in Bitcoin donations to the army.

Are you a DAO-ting Thomas?

NFTs have diverse use cases, but ‘humanitarian tools for fundraising’ is certainly an unexpected one. Just this month, a group of self-identified “cypherpunks” came together to create AssangeDAO. The DAO raised over $45 million in ETH to bid on an NFT and raise funds for Wikileaks founder Julian Assange’s legal defense.

However, critics of NFT-based fundraising have lamented the loss of donations through extravagant gas fees.

Adding to that, the World Wildlife Fund’s recent foray into the NFT industry with its “tokens for nature” collection minted on the Polygon blockchain also received global backlash due to environmental concerns.