On-chain analytics have proved useful in giving current information about movements in the #cryptocurrency industry. Yet the most recent on-chain findings have revealed a decline in Ethereum network fees, which may signal a turning point in the market value and performance of the cryptocurrency.
The #Ethereum network costs have decreased to their lowest levels in 2023, with each transaction averaging under $1.15 as of this writing, according to the on-chain monitoring tool Santiment. This shows a sharp decrease from the exorbitant fees observed in 2021 and 2022, when the need for processing power caused the average fees to exceed $50.
In the past, a drop in fees like this has been an indicator of Ethereum's utility and popularity because higher fees make using the network less profitable. Santiment added that as the cost of circulating ether tokens decreases, greater utility is frequently the result.
It is important to keep in mind that this development may have an effect on the market value of the digital asset as a whole. The market capitalization and value of Ethereum may rebound as a result of increased usage and adoption.
The Impact On The Pricing Of ETH?
Moreover, the declining network fees are to Ethereum's and its users' advantage, particularly as they can enhance other network metrics and attributes. However, as ETH appears to be battling to escape the present selling pressure, this revelation has not had a substantial impact on ETH pricing.
The psychological $1,600 mark was breached by the cryptocurrency for the second time this month on Thursday, September 21. Yet the price of the Ether token has fallen by about 2.6% over the last three days as it continues to trade below this threshold.
Investors will be keeping an eye on Ethereum to see if it can develop a strong network while fees are cheap. But it's unclear whether this will be sufficient to break the ETH price out of consolidation, especially because there are no indications that Ethereum whales are exerting any buying pressure.
Furthermore, there is no optimism added to this scenario by the declining number of significant ETH holders. This is because a drop in whale holdings of this magnitude could make Ethereum's price more vulnerable to pressure from below.
The price of the Ether token is $1,593, down 2.6% over the last week, according to CoinGecko data. The second-largest cryptocurrency at the moment is Ethereum, which has a $191.6 billion market cap.
