Ethereum records lowest network fees since 2020 due to NFT cool down
The Ethereum network this Sunday recorded its lowest transaction fees since December 2020
The current reduction in fees, in median terms, can be attributed mainly to the current bear market, which has led to a drop in activity on the network. Recall that network fees reached all-time highs during the peak of the NFT boom in May last year, which played out on NFT marketplaces built on Ethereum
Another contributing factor to lower transaction fees in USD terms is a drop in the price of Ether relative to the Dollar. Fees have increased to $1.45 at the time of writing from a low of $0.87 in late June. For perspective, transaction fees reached all-time highs in May last year, peaking at $37
Ethereum users have been granted their wish but perhaps not in the way they would have wanted. On Sunday, the network posted its lowest transaction fees since December 2020, but it’s mainly due to lower Ether prices and a decrease in activity on the blockchain.
Daily sales of NFTs dropped to 19,000 in June, the lowest numbers this year. In September last year, NFT sales peaked at 224,768. Median transaction fees on the Ethereum network have tracked these dips and peaks in NFT sales.
Learn more about Ethereum and how it supports NFT marketplaces on the Luno learning portal.