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Ethereum Experiences Historic Drop In Network Fees: Report

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Ethereum network has reported the lowest average fees as of the current year since the year 2016. This disclosure was made by the founder of Wu Blockchain on X, who ensured that information on this was passed on by Coinbase Director Conor. The above data implies that of the ten least average fees per hour on the Ethereum network nine were encountered this week and all the nine were less than 3.3 gwei.

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On June 30, the average fee per hour on the Ethereum network was a mere. This was the second lowest point in the network’s recorded history with fees standing at a paltry 2.94 gwei. This is a clear indication that Ethereum users and the entire crypto space could be standing on the edge of a new and exciting phase.

Ethereum Fees Hit Record Lows

The network fees plummeted, while during the previous year fees were as high as 100 gwei during peak hours of network traffic. Some reasons for the decrease include; improvement in the efficiency of ETH in the recent past due to the upgrades and changes made to the network that aim at improving the capacity of the network.

These historically low fees are expected to affect the Ethereum ecosystem in a very big way. This reduces the cost of doing business and hence encourages more people to engage in activities within the network, developers deployment of dApps and more transactions. It is also important to note that the reduced fees also help in creating a lowered barrier of entry for new investors and the smaller investors thereby giving everyone an equal chance to be a part of the Ethereum network.

Also, this fee reduction is consistent with the Ethereum’s vision of moving to Ethereum 2.0, which is already expected to enhance the scalability and decrease the costs by moving from the proof-of-work to proof-of-stake consensus models. As the ETH community is still striving for these upgrades, current low fees are telling about the possible future state of the network and its cost.

Decreasing fees on the ETH network are a perfect opportunity to evaluate the platform’s current state. The future of Decentralized Finance and Blockchain technology is hereby being altered as the crypto world patiently waits to see what shall follow the reduced fees.

Ethereum Transaction Fees Plummet To $1.12, Santiment Analyzes Market Sentiment

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A well-known analytical platform Santiment has provided invaluable data on Ethereum’s transaction fee scenario. Santiment disclosed in a recent post on the X platform that the average fee for Ethereum network transactions has dropped to a mere $1.12. This records the lowest daily average cost seen since 18th of October.

The discussion focuses on a complex link between market sentiment and transaction fees in the world of cryptocurrencies. Traders frequently oscillate between periods of exuberance, characterized by the confidence that crypto is heading to astronomic gains (“To the Moon”), and episodes of despondency, where pessimism rules (“It Is Dead”). Noticeably, these changing emotions are embodied in transaction costs.

Ethereum Transaction Fees: Mirror Of Market Sentiment

Observations show that transaction fees typically peak, mostly during euphoria, when also the prices tend to reach their highest. On the other hand, fees have a tendency to retreat to more modest levels in market declines. The pattern is cyclical and it mirrors the change of moods in the investors, therefore, this is a useful selection of the state of the market.

Taking into account the recent market movements, with prices retracing for the last six weeks, Santiment proposes that the low demand and relaxing network difficulties could smooth the recovery process for Ethereum and related altcoins. This analysis however suggests the early market turnaround than many participants expect.

The observations presented by Santiment highlight the relevance of tracking transaction fees as an indicator of market mood and the nature of underlying demand dynamics. With the changes that take place in the Ethereum system, the analysis of certain type becomes very important for investors and traders to cope with the capricious world of cryptocurrency.

While the crypto market is always in turbulent state with constant price fluctuations and sentiment changes which seem to determine the narrative, Santiment’s data-driven approach tends to provide the clarity in the uncertainty. As the transfer fees in Ethereum reached all-time low, attention shifts now to how this will affect the entire market of cryptocurrencies in days and weeks to come.

Visa’s Bold Move: Direct On-Chain Gas Fee Settlement via Visa Cards

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In a potential game-changer, Visa, a global payment leader, is piloting an inventive approach allowing users to settle on-chain gas fees directly via Visa cards, signaling a step toward melding conventional finance with the decentralized domain.

News of this groundbreaking endeavor was unveiled by well-known crypto analyst Wu Blockchain on August 11th, 2023, marking a pivotal move towards harmonizing traditional financial systems with the rapidly evolving blockchain landscape.

The product manager at Visa, Mustafa Bedawala, emphasized a notable hurdle related to cryptocurrency wallets. The persistent need to monitor Ethereum (ETH) balances for gas fee coverage has emerged as a significant challenge.

Traditionally, Ethereum users navigate fluctuating gas fees by acquiring ETH from exchanges or on-ramps, which often leads to inefficiencies and complications due to the volatile nature of gas prices.

Visa’s Off-Chain Solution And Innovation

According to a recent report, Visa’s trailblazing solution leverages Ethereum’s ERC-4337 standard and the ingenious “Paymaster” smart contract, introducing an off-chain gas fee settlement process. Users initiate an Ethereum transaction from their wallets, which is routed to the paymaster.

The paymaster calculates the gas fee and bills via Cybersource. After swift digital signature validation, the wallet attaches the signature before transmitting it to Ethereum. Paymaster verifies and covers the gas fee, enabling users to seamlessly pay gas fees via their cards off-chain, sparing them from the need to retain ETH exclusively for fee payments.

Visa’s innovative model underwent trials on the Ethereum Goerli testnet, employing readily available open-source tools, including Stackup’s userop.js library. Successful trial transactions validated the feasibility of fee coverage via the Paymaster, effectively eradicating the ETH requirement.

This revolutionary concept extends beyond user convenience. The framework could empower merchants and decentralized applications to streamline customer interactions, revolutionizing gas fee payments through cards. Furthermore, wallet and PayMaster providers could seize the opportunity to introduce Visa card-based gas fee payment options, marking a leap forward in blockchain usability.

In a space marked by constant evolution, Visa’s strides in off-chain gas fee payments set the stage for a more seamless and user-friendly blockchain experience, bridging the gap between traditional finance and the decentralized frontier.

Related Reading:| Visa Expands Crypto Payments Reach: Embracing Ethereum Account Abstraction

Ethereum’s Gas Fees And Supply On Exchanges Hit Historic Low

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Ethereum, the world’s second-largest crypto has registered some notable activity. As highlighted by prominent on-chain analytics firm Santiment, ETH’s average transaction fees have fallen by 70% to $4.28 after its previous peak of $14 in early May.

Despite being widely used, the ETH network has been known to turn consumers away because of the high gas costs associated with network transactions.

Gas fees are the computational resources essential to carry out transactions on the network. There can be various reasons for high gas fees such as popularity & network congestion – Limited gas space per block – Varied gas consumption based on tx complexity – Increased complexity of dapps & smart contracts

Santiment believes the Ethereum network will benefit from the falling transaction cost as more people would be able to use the network due to affordability, thereby boosting its utility.

Moreover, there have been serious efforts to address Ethereum’s scalability issues, notably the Cancun-Deneb upgrade that targets the scalability of the Ethereum blockchain.

Here, Proto-Danksharding, also known as EIP-4844, is the main focus of the update. Proto-Danksharding is a critical component of Ethereum’s long-term rollup-centric roadmap and is anticipated to enhance data accessibility for rollups and lead to a large decrease in gas fees on Ethereum Layer-2 rollups.

Along with the decreased costs, Ethereum is now trading at an all-time low of 9.9% on exchanges as owners have displayed stronger convictions than selling off and held onto their assets more firmly.

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Ethereum's Gas Fees And Supply On Exchanges Hit Historic Low 3

The amount of ETH on exchanges has decreased to levels last seen in the early days of the altcoin as staking consumes the available tokens.

Since the Shapella upgrade, more than 4 million more coins have been deposited and added to the Eth network, indicating that major Eth holders are increasingly choosing to create passive income rather than sell their holdings.

Ethereum Headed For A Price Upswing

Market experts believe that this decrease in supply on exchanges is a positive sign as it might indicate an impending price upswing and a bull run.

In fact, both ETH and BTC have moved significantly off exchanges, which is why investors continued to paint a bullish picture of the assets.

According to data from Coinglass, funding rates for BTC and ETH have continuously been favorable on a number of exchanges. This implied that the majority of investors were betting on an eventual rise in the price of both cryptocurrencies.

Ethereum Trader Paid $119K Gas Fee For A Single Transaction

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Ethereum’s escalating gas fees are becoming a source of concern after recent data showed a user paying a whopping $119k in fees for a single transaction.

Data highlighted by WhaleAlert revealed that the trader had to shell out 64.01 ETH worth roughly $119,121.

Not long ago, ETH’s gas median hit 141gwei [one-billionth of one ETH], the highest rate since May 12th, 2022.

The sudden surge took many by surprise, given that it had been about a year since the median gas rate had surpassed the 100gwei mark.

Uniswap-related contracts were discovered to be the main consumers of Ethereum Gas during these times, TronWeekly reported.

However, the high gas fee is not a new phenomenon on the Ethereum network. Especially before the transition from the proof-of-work [PoW] protocol to proof-of-stake [PoS] through the Merge.

At the time, the exorbitant gas fees pushed away users to opt for other platforms. In fact, these led to the birth of many other layer-2 scaling solutions like Polygon zkEVM, Arbitrum, and Optimism.

The primary reason for the skyrocketing gas fees was the slow speed of the Eth chain. The network was bogged by the huge number of transaction requests, and that’s when miners increased the gas fee.

As a result, the Eth chain’s scaling was impacted, and many users typically missed the chance to complete a transaction.

And this is where the switch to PoS was supposed to help with the gas problems by essentially declogging the network.

But it appears that ETH’s biggest challenges have made a comeback with the recent record-high gas fees. Market experts have pinned the blame on the meme coins buzz that sparked high network activity and caused a blockage over the weekend.

Ethereum Whales Panic Selling Amidst Meme Coins Frenzy

This uptick in the network activity hit an all-time high after Binance listed two of its most trending tokens, PEPE and Floki Inu for trading on its platform.

Additionally, the panic selling by whales that contributed to this traffic may have reduced the gains made by these meme coins, especially for retail traders.

Ethereum’s large-scale investors have resorted to panic selling in response to Vitalik Buterin and the Ethereum Foundation selling significant amounts of their holdings,

Data from Lookonchain showed that the two whales have emptied 19,090 ETH worth $35.7 million on Uniswap.