A recent study by CryptoQuant says that Ethereum’s transaction costs have hit all-time lows. The daily average price of gas has dropped to about 2.9 Gwei, and the daily average fee for a transaction is now only $0.85. This is the lowest level for the network in many years.
Even though costs have gone down, the number of daily transactions has stayed the same or even gone up a little compared to the last two years. This means that lower fees have not stopped people from using the Ethereum network. The network is still very active and healthy.
Ethereum Price Struggles Continue
According to the CryptoQuant expert known as “EgyHash,” the big drop in fees is because of the Dencun upgrade that happened on March 13. With this update, a new type of transaction called “Blobs” was added.
This type of transaction makes it cheaper for Layer 2 networks on Ethereum to post data. Because of this, networks such as Arbitrum, Base, and Optimism can now post data on ETH for a lot less money, which could cut costs by as much as 100%.
These lower transaction prices make Ethereum easier for more people to use, but they also make things harder for investors. EgyHash said that even though prices have gone down, ETH has had a hard time keeping its price above important levels.
While low fees are beneficial for users, they might not be advantageous for investors, especially given the substantial portion of Ethereum’s usage that is being offloaded to its Layer 2 networks, and the potential problems this could cause, such as user and liquidity fragmentation.
ETH’s value has dropped by 4.2% in the past week. At the time of this story, it was trading at $2,591.This price battle has been going on since the Dencun upgrade, even though Ethereum-based exchange-traded funds (ETFs) were just approved.
