Bitcoin and Ether transaction fees have dropped to their lowest levels in several months as the crypto market faced a tumultuous week in 2024.
On June 23, the average Bitcoin transaction fee hit $1.93 per transaction, the lowest it has been since October 2023. The decrease in fees on the Bitcoin network indicates reduced network activity and less competition.
The fees on the Bitcoin network often surge during times of high market volatility, particularly when prices are on the rise. The increase in price speculation leads to intensified competition for block space.
Every major bullish period since 2012 has resulted in a corresponding fee increase, except for the 2021 bull run when the Bitcoin (BTC) price reached $69,000, but the transaction fees remained relatively low.
In contrast, Ether (ETH) gas fees have also reached a new low, with gas prices dropping to as low as 1 gwei, the lowest in years. The current gas fee on the Ethereum network is about 4.5 gwei.
The low gas fee on Ethereum is attributed to activity shifting from Ethereum’s base layer to its layer-2 network after the March Dencun upgrade. Since the upgrade, average gas prices on Ethereum have decreased by about 92%. According to a report from Layer2 Insider, the layer-2 networks pocketed $950,000 in the last week.
The low transaction fees on the top two cryptocurrency networks come as the crypto market experiences one of the worst weeks in 2024. The price of Bitcoin dropped below the $63,000 support level, and several altcoins saw double-digit declines.
The crypto market has experienced significant growth over the last six months, with top cryptocurrencies like Bitcoin and a few altcoins reaching new all-time highs. However, in the past couple of weeks, the bears have been in control, resulting in heavy losses for leveraged market participants and spot holders.
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