With fees steadily falling, the average cost of a transaction on Ethereum (ETH) has hit a 4-year low in recent days at $0.56. Converting this to Gwei, we could even see an all-time high. Let’s take a look at these numbers.
Ethereum (ETH) transaction fees hit record lows
As cryptocurrencies struggle to find their way back to the upside since the acceptance of spot Bitcoin (BTC) ETFs earlier this year, Ethereum seems to be suffering particularly from the situation. with ETH at $2,345, down nearly 43% from a yearly high of $4,090 on March 12.
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Mechanically, on-chain activity has decreased significantly, leading to a sharp drop in transaction fees on the network. The situation is such that the average price of a transaction has fallen below $1 in recent days, even reaching $0.56 on August 31:
Figure 1 — Average price of a transaction on Ethereum
To find such low prices, we have to go back to spring 2020, when ETH was still trading below $200. For reference, the gas price is set at 2.11 Gwei at the time of writing. Moreover, with an average level of 2.21 Gwei on the day of August 31, this constitutes an absolute record over the entire life of the network.
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In terms of daily transactions on Ethereum, the trend is also downward over the last 6 months. Although the numbers are not alarming, we can see on the graph below that this value tends more easily towards a million transactions per day, where it could still exceed 1.25 million in the spring:
Figure 2 — Number of daily transactions on Ethereum
Moreover, this drop in activity combined with the Dencun update also had an impact on the emission of ETH numbers. Indeed, it has become inflationary again, at a rate of 0.71% per yearbased on data from the last 30 days.
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However, there is also some positive on-chain data despite the current environment. For example, the amount of ETH staked exceeded 34 million last month, and this number has now increased to 34.26 million units, or nearly 28.5% of the market cap. Thus, this brings the number of validators to over 1.07 million.
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Source: Etherscan
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