Ethereum Sees Lowest Median Gas Price Since 2019

Crypto News Cryptocurrencies

Written by Gode S.,

Web3 Market Analyst

Last Updated: August 12, 2024

Key Takeaways

Ethereum's transaction fees hit their lowest since mid-2019, with median gas fees dropping to 1.9 Gwei on August 10;
The Ethereum Dencun upgrade in March helped reduce fees;
Layer-2 blockchains are increasingly used for scalability, handling more transactions at lower costs.

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Ethereum Sees Lowest Median Gas Price Since 2019

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Ethereum's transaction fees have reached their lowest point since mid-2019.

Dune Analytics data shows that Ethereum's median gas fees had dropped to 1.9 Gwei on August 10, marking a fall of nearly 98% from the year-to-date high of 83 gwei recorded in March.

The reduction can be partly attributed to the Ethereum Dencun upgrade, which took place in March. This upgrade incorporated nine Ethereum Improvement Proposals (EIPs), including "proto-danksharding," which is designed to optimize data storage and slash transaction fees.

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The Ethereum ecosystem has increasingly relied on Layer-2 blockchains for scalability. These solutions can process a larger volume of transactions at a lower cost by offloading them from the main Ethereum blockchain while still utilizing it for transaction validation.

Reflecting on the decline, Gnosis co-founder Martin Köppelmann expressed his views on X on August 10, pointing out that a minimum gas fee of 23.9 gwei is necessary to sustain staking rewards, incentives provided to those who validate blockchain transactions.

Overall, the drop in Ethereum gas prices signifies an important change, influenced by advancements in Layer-2 technologies and significant protocol upgrades. Yet, it also brings new challenges and considerations for the network's economic sustainability.

In other news, as of August 7, Ethereum exchange-traded funds (ETFs) have attracted nearly $870 million in total inflows.