Ethereum’s Gas Fees Hit All-Time Low as Coin Price Soars Above $2,600
The ethereum blockchain network has faced persistent challenges with high gas fees, posing risks to its long-term usability, affordability, and scalability. Despite this, there has been a recent notable development as the average daily gas fees on the network dropped to their lowest point in five years.
According to Jordan Prainito, Head of Operations and Business Development at Glue, “[Ethereum’s] gas fees recently plummeted to a five-year low, with fees dropping as low as 0.6 gwei [one-billionth of one ETH] earlier this week.” Prainito highlighted that low-priority transactions have been observed at just 1 gwei or even lower, marking a significant over 95% decrease from the levels exceeding 83 gwei witnessed in March during a surge in network activity.
Prainito attributed this unexpected price decline to a migration of users and developers to what are perceived as “trendier blockchains” due to their lower fees and faster transaction speeds. He noted, “Historically, such a significant drop in [ethereum’s] gas fees has often signaled a midterm price bottom for [ethereum]. Prices tend to rebound following these lows as part of the cyclical market pattern. This current dip in gas fees could be an indicator that [ethereum]’s price is nearing the pico bottom, setting the stage for a rebound in the coming weeks if past trends hold true.”
In a recent tweet, Ethereum co-founder Vitalik Buterin expressed his perspective on the situation, stating, “Needs to get under $0.05 to be truly acceptable imo. But we’re definitely making great progress, and even proto-danksharding may be enough to get us there for a while!” The current price of ethereum stands at approximately $2,600.
Two years ago, Buterin emphasized the importance of reducing Ethereum’s fees to below 5 cents to maintain attractiveness. Furthermore, in a Reddit Ask Me Anything session earlier this year, Buterin hinted at the benefits of increasing the Ethereum network’s transaction capacity, potentially resulting in reduced gas fees.
