- The cost of transacting on the Ethereum network has significantly decreased recently, much like Bitcoin’s onchain fees. Ethereum’s network costs have decreased by 93.7%, from $30.33 per transfer to $1.91 per transaction, in the 68 days that have passed from March 5, 2024.
This week, bitinfocharts.com announced that the average cost of transacting on the Ethereum blockchain dropped dramatically to around 0.00065 ETH, or $1.91, per transaction.
Furthermore, data gathered by the gas tracker on etherscan.io shows that the current cost of completing a standard ETH transfer is between 4 and 7 gwei, or $0.18 and $0.37 per transfer.
This weekend, the anticipated cost of doing an NFT sell may be between $7.03 and $12.31, while the expected cost of conducting a decentralized exchange (DEX) swap on Ethereum can vary between $4.16 and $7.28.
Ethereum has seen somewhat more than a million transactions every day on average throughout the past 50 days. With 1.324 million transactions, March 22, 2024 was the busiest day, and April 4, 2024 was the slowest with 1.091 million transactions. Around 1.212 million transactions have occurred on a daily basis during this time.
The current annual inflation rate for Ethereum is 0.895%, according to data from ultrasound.money. However, the yearly issuance rate under the proof-of-work (PoW) model would have been 3.923% if Ethereum had not switched to the proof-of-stake (PoS) architecture. In addition to the issue rate, the London fork occurred on August 5, 2021, 1,010 days ago.
Ethereum Improvement Proposal (EIP)-1559 was effectively proposed with the London update. This amendment replaced the first-price auction approach for the gas fee structure with a more stable base fee that is burned, permanently removing it from circulation.
To date, 4.29 million ETH worth $12.51 billion have been burned since this implementation. Although the significantly lower transaction fees are good for users, ETH validators are facing financial difficulties as Ethereum enters its inflationary phase.
The financial incentives related to network security are impacted by these decreased fees. In contrast, because of its declining hashprice, Bitcoin has seen over 100 exahash per second (EH/s) of hashpower disappear since the previous halving.
This emphasizes how difficult it will be to strike a balance as Ethereum’s monetary policy and transaction cost structure change between keeping validators well compensated and ensuring user affordability for adoption objectives.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
