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According to a recent analysis by CryptoQuant, the Ethereum gas price has reached a new all-time low.
Ethereum’s daily average gas price fell to a new all-time low of 2.9 Gwei, while daily average fees in USD fell to a new multi-year low of $0.85.
As a result, Ethereum’s average daily burn rate dropped significantly. According to CoinGecko’s recent study, ETH emissions exceeded the burn rate in 2024, with 540,958 ETH issued and 465,657 ETH burned, representing a net addition of 75,301 ETH to the network.
Despite a significant drop in Ethereum gas costs and burn rate, average daily transactions have remained stable or increased slightly compared to the same period over the past two years.
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This drop is most likely due to the Dencun update that was triggered on Ethereum on March 13th of this year. The upgrade included “blobs,” a new type of transaction that allows Layer 2 networks like Arbitrum, Base, Optimism, and others to publish data on Ethereum with significant fee reductions of up to 100%.
Is Ethereum facing a new challenge?
While low fees benefit users, they may not be beneficial to investors, especially given that a significant portion of Ethereum usage is offloaded to Layer 2 networks and this can lead to potential problems such as user and liquidity fragmentation.
Despite the launch of Ethereum ETFs, the price of ETH has dropped following the Dencun update. The ETH supply has increased by about 197,000 ETH worth $500 million, while the price has dropped by 35%.
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At the time of writing, ETH was down 2.79% to $1,585 over the past 24 hours and down 5% weekly.
According to the latest CoinShares report, digital investment products saw light inflows of $30 million last week as recent macroeconomic data suggested the Fed was less likely to cut interest rates by 50 basis points in September. Last week, Ethereum only saw inflows of $4.2 million despite brisk activity among ETF providers.
