Tyler Swope, a popular cryptocurrency trader with a large following on social media, has revealed in a new video he believes the Chi Gastoken (CHI), a little-known token created by the team behind decentralized finance (DeFi) powerhouse 1inch.exchange, could surge tenfold in the new future.
The Ethereum-based token, Swope said, can help traders capitalize on the soaring gas fees to transact on the Ethereum network. After pointing out the deployment of a smart contract on the Ethereum network requires a substantial amount of gas, Swope pointed to the advantage of the Chi Gastoken:
The CHI token is used in combination with any smart contract and it’s burned with the transaction and it can reduce the cost of that smart contract by almost half.
The token, he says, was developed by the team at 1inch in a bid to give their users a way to avoid high trading fees on the platform. 1inch, it’s worth noting, is one of the largest DeFi protocols and a decentralized exchange aggregator.
Ethereum transaction fees, as reported, have surged over the last few weeks along with the price of ether itself. Data shows that at the beginning of 2020 the average transaction fee on Ethereum was about $0.08, while now the average cost to move ETH on the network is above $15. The price of the cryptocurrency has similarly surged to over $1,100, its highest since January 2018.
To Swope, investing in CHI can be a hedge against the high fees being paid on the Ethereum network. He said:
It’s basically a token to hedge against Ethereum gas prices. Since gas increases in bullish cycles or whenever Ethereum gets volatile, the CHI token, it also increases.
While the analyst is bullish on CHI in the short-term, he added that Ethereum Improvement Proposal (EIP) 1559 could be negative for the cryptocurrency, as it’s designed to make the gas fee market more efficient on Ethereum, and could burn some of the transaction fees paid to move funds, helping reduce the circulating supply of ETH.
Featured image via Unsplash.
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.