thecoinrepublic.com
Since the Ethereum network received wide adoption, it has been facing issues in terms of gas fees, which are now at relatively low levels
For those who have known crypto space for a while now and understand how crucial a transaction or gas fee could be on a blockchain network. It becomes a make-or-break point in several instances. This notion came when the highly popular blockchain network Ethereum (ETH) emerged as one of the highly efficient blockchain solutions with smart contract capabilities.
Almost every other project wanted to be on Ethereum. But this started a sort of cyclic effect that eventually resulted in high gas fees and continued until now, given that the transaction fees have dropped drastically. Average gas fees on the Ethereum network have fallen to their lowest point in the last 19 months, as recorded on 2nd July 2022.
Primarily, the gas fee or a transaction fee on a network is the amount of Ethereum (ETH) that is needed to pay in order to place any transaction on the network. The Ethereum network was expanding given the number of crypto projects like decentralized application, decentralized finance, and other innovations making the blockchain network their underlying network.
The transaction fees that these senders on blockchain networks like bitcoin (BTC) and Ethereum (ETH) are allocated to the participants in the mining process in the form of rewards to play their crucial role in verifying the transfers.
Earlier, these transaction fees’ on the Ethereum network were relatively low, where they cost even less than a penny per transfer; this lasted till July 2016. After this Ethereum network has seen a hike in gas fees given the increasing activity that resulted in average fees between July 2016 to May 2017 staying around $0.01 to $0.1.
ALSO READ – Is Nayib Bukele Using Bitcoin To Create Illusion In El Salvador?
These were, however, the good old days of the Ethereum network that has seen a massive hike in transaction fees since then, and by May 2021, average transaction fees on blockchain per transaction reached up to $69.
However, the average price came down later but had not dropped any lower than $20 between August 2021 till February 2022. There were even some instances when the gas fees were seen charging $30, $40, and even $50 per transaction, but this, by and large, depends upon the type of transaction and apparently on which day the transaction is being made. For instance, the average transaction fee on the Ethereum network saw a high of $196 per transfer, on 1st May 2022, due to the famous non-fungible token sale on the day.
However, these were the pieces from history as the average fees on the network have dropped drastically. It seems like gone were the days when the Ethereum network had a bad name for high transaction fees, as on 2nd July 2022, the network saw a drop in its gas fees where average fees remained about 0.0016 ETH or $1.67.
This becomes important as the last time Ethereum was at around this level was in November 2020, when its average gas fees per transaction were 0.0034 ETH, equating to $1.55 given the price of ETH at the time. As if it’s clear that transaction fees are very much dependent upon the activities on the blockchain, since there are barely any movements on the blockchain in terms of heavy activity, gas fees are enjoying their lows in the meantime.