- Ethereum’s average gas price hit 6 Gwei, its lowest since January 2020.
- Martin Köppelmann questioned the sustainability of this trend.
- The decline in gas fees is attributed to the Cancun-Deneb upgrade and reduced on-chain activity.
Ethereum network witnessed a significant decline in its intraday average gas price, plunging to 6 Gwei. According to Etherscan metrics, this figure marks its lowest point since January 2020. On the other hand, this drop in gas fees translates into remarkably affordable on-chain operations for Ethereum users.
Co-founder of Gnosis, Martin Köppelmann, commented on the development, questioning the ongoing trend. “Ethereum base fee is at record lows. The blob fee still has not even entered price discovery (with a very short exception) and thus is at absolutely 0.
Is this the new normal or will we see periods of +100 GWEI again and by what demand will they be driven?” Köppelmann stated.
Recent observations attribute the decline in gas fees to the combined effects of the Cancun-Deneb upgrade and a downturn in on-chain activity within the Ethereum network.
With the cryptocurrency markets experiencing relative calm and an overall modest uptick, various usage metrics have decreased accordingly. Meanwhile, reports indicate that Ethereum’s supply has even relinquished its deflationary status, which these factors have influenced.
As a result of these developments, users can now execute asset swaps on Ethereum for a mere $5 commission. At the same time, cross-chain bridging services are available at a nominal $2 fee. Furthermore, the minting of non-fungible tokens (NFTs) on Ethereum comes at an accessible cost of $9.
The USD gas fees recorded today are the lowest observed in the past six months, with the last comparable instance recorded in November 2023. Alongside this, the cost of Ethereum transactions decreased by 93%, from $30 to $2, per insights from BitInfoCharts.
On May 9th, Vitalik Buterin, Ethereum’s founder, proposed substantially upgrading the platform’s gas mechanism. This upgrade unveils the concept of multi-dimensional gas and provides Ethereum with enhanced flexibility in managing various resources.
The proposal is also predicted to improve Ethereum’s throughput capabilities without compromising safety. This suggested enhancement signifies the evolution of the Ethereum ecosystem and its increasing utilization.
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