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The price of Ethereum (ETH) has not really kicked off despite the bullish sentiment in the market. However, various signals are pointing toward a potential rally for the leading altcoin on the market. This week saw a huge jump in one of the most crucial metrics, injecting more positivity among investors.
Leading market intelligence platform IntoTheBlock has shared an important update for Ethereum. It revealed that the network fees of Ethereum have reached the highest level since early June of this year. Remarkably, Ethereum fees skyrocketed 188.51% this week, as it stood around $45.2 million.
What does it mean for ETH price?
The rising ETH fees are crucial as it can have a positive impact on its price movements. This surge in fees means that the network activity has increased, and more transactions are taking place on the Ethereum blockchain. It basically means that the demand for Ethereum is increasing.
Eventually, the rising demand can result in rising ETH prices. Rising fees can also help in keeping Ethereum deflationary. The London hard fork of Ethereum, which took place in 2021, introduced EIP-1559. It burns a potion of gas fees to reduce the overall circulation supply in order to make ETH deflationary.
As fees increase, more ETH will be burned, and it will potentially inject deflationary pressure on the market. This can result in major price hikes over the long term. Overall, the rise seen in gas fees last week is a bullish development for the ETH price, which is currently trading at $2,653. It has seen an increase of 1.06% in the last 24 hours.
Moreover, the trading activity has also increased during this time. The trading volume of ETH has surged 16.08% to a whopping $17.38 billion. This means that bulls are returning to the market as the sentiment is shifting from bearish to bullish. Consequently, notable price increases are expected from the coin.