Ethereum Transaction Fees Have Dropped to Near-One-Year Lows

Although Ethereum continues to have one of the greatest transaction volumes in the crypto industry, the blockchain has recently seen a decrease in transaction fees. The fees have dropped dramatically, which is a great development for network customers.

Ethereum transaction fees have just decreased. This is due to user migration away from the network and toward alternative smart contract networks. Nonetheless, it is the industry’s premier smart contract platform.

Specifically, the drop in transaction fees has been worrying, since it is now the lowest in ten months. The last time Ethereum saw such low transaction volumes was in July 2021.

In recent months, the network has seen extraordinarily high transaction fees, which were caused by increasing network activity due to the emergence of decentralized finance (DeFi) and non-fungible tokens (NFTs).

The average fee is $5.05 at the time of writing, but it fell below $3 on Sunday. It is the lowest level of transaction costs in over a year. Although the median fees have decreased dramatically, trading NFTs on OpenSea and performing coin swaps on decentralized exchanges still resulted in hefty transaction fees.

A decrease in transaction costs can effect a cryptocurrency like Ethereum in a variety of ways. Although the implications are never perfect, past data might serve to identify a general direction for the price coming forward.

One of these momentous moments occurred in July 2021, when ETH fees fell below $3. This was followed by a rise that increased the value of the digital asset from around $1,700 to $4,000 in the next two months.

Given this, it is possible that ETH is preparing for a rally. This is supported by the market’s recent rebound trend, which has put the digital asset back on track to reach $2,000 once more. This is dependent on whether buyers can easily take control of the market and push Ethereum back above $2,000.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Patrick

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