The stagnant cryptocurrency market and changing conditions are impacting Ethereum (ETH) network activity. The significant decrease in activity on the ETH network has resulted in total fees falling to record lows. The stagnation in the market is reflected in the trade as well as the on-chain data.
On-chain follower IntoTheBlock shared an important statistic on his social media account. The daily fee paid by users for transactions on Ethereum fell to 1,719 ETH (about $2.8 million) on August 27 to a six-month low, according to data from the crypto statistician.
Total daily fees on Ethereum reached a 6-month low on Sunday, registering at 1.72k $ETH. Could this be a sign of investor caution in today's market landscape?
Dive deeper into the data🔗https://t.co/af9A4ahkBq pic.twitter.com/XiMapAQvx2— IntoTheBlock (@intotheblock) August 28, 2023
This figure represents a 97% drop compared to the annual high of 84,000 ETH recorded at the beginning of May. The fee paid per transaction, on the other hand, has been cheaper by 70% since then. The weakening in network fees causes the revenue of validators to decrease as well. According to the data, Ethereum network revenue has dropped by 22% in the last 30 days.
Experts attribute the decrease in tier-1 network fees to tier-2 projects that have come to the fore in recent months. Altcoin projects, which are solutions to the scaling and high gas fee problems of the ETH network, attracted attention from investors.
Therefore, daily transaction volume on the Ethereum network has dropped 78% from its annual peak in March of $13.42 billion.
