AAX is pleased to be the first cryptocurrency exchange to support Polygon-Wrapped Ether (wETH).
AAX crypto exchange launched wETH direct deposits and withdrawals on October 25, 2021. Wrapped Ether, which is backed on a 1:1 ratio with Ethereum (ETH), enables investors to use the token to trade ETH with other ERC-20 tokens on decentralized networks. With most DeFi projects running on Ethereum blockchain, this enables interoperability and ease of transaction.
Ethermine, the largest Ethereum mining pool
Currently, wETH is of particular interest to Ethereum miners, who sometimes receive it as a payout option for their mining efforts on Polygon Network. Ethermine, an Austrian mining pool run by Bitfly blockchain technology firm, is the largest mining pool for Ethereum at the time of writing. Mining not only ETH, but Zcash (ZEC), Ethereum Classic (ETC), Ravencoin (RVN), and Beam (BEAM), miners are offered two payment options for their block validations- ERC-20 tokens or wrapped ETH.
Depositing wETH to AAX
Receiving wETH as a mining reward enables miners to keep most of their profits. Instead of being charged hefty transaction fees of 0.1 -10 ETH for withdrawing their mining rewards, miners are now able to process their wETH on AAX through the Polygon Network at a low cost and with real-time settlement. In fact, through AAX crypto exchange, the processing fee is merely 0.005 ETH when done through the Polygon chain.
This makes a huge difference for miners as they will now be able to pocket most of their proceeds, keeping a larger portion of the commission reaped from their mining efforts. Anton Gulin, AAX’s Country Manager for Russia, Ukraine, and CIS, elaborated on this:
“In most of the mining pools, you can get paid in ERC-20 tokens through Ethereum Mainnet but in this particular case, you can also get your payouts in wETH on Polygon Network. Why does it matter? Because it is insanely cost-effective for miners to receive payouts in wETH on the Polygon network and to move it around the space. And now, being able to deposit it directly to an ecosystem where you can convert it to almost any popular token with a competitive fees structure and an option of subscribing to high-yield Savings is something really special.”
EIP-1559, a new fee-burning mechanism that Ethereum is seeking to implement and that occurred at the same time as the London hard fork, transformed the structure of the payout scheme for Ethereum miners. Transaction fees, which are charged in Ethereum, are now separated into two parts, a base fee and a priority fee.
With the implementation of EIP-1559, Ethereum’s token economy has drastically transformed, making Ether a deflationary supply. Subsequently, Ethereum miners have seen a drop in profit. However, that has not dissuaded them from keeping up their mining activities. Due to the boom experienced by the NFT space and the rise of Ethereum prices, miners have still managed to thrive.