March 16, 2022
By Tiasha Chatterjee
The gas fees of Ethereum has dropped as low as 10 gwei per gas unit even for high-priority transactions, with its layer 1 becoming a bargain deal which is even lower than its sidechains, such as Polygon. The gas fee is currently at the lowest it has been since July 2020.
Since Polygon adds 30 gwei to all transactions to reduce spam transactions, Ethereum’s gas fees have become comparable to Polygon’s fees, and sometimes even lower.
Here is what we know:
- One gwei is equal to one-billionth of an eth, which means that a transaction on the Ethereum (ETH) mainchain can be as cheap as 50 cents in total. In nearly two years, this is the first time that using the Ethereum network’s chain has become so affordable for the users.
- If we go back to May 2021, the gas fees of Ethereum had reached as far as USD 70 per transaction. On May 19th 2021, the gas fee had reached its all-time high, recorded at more than 659 gwei on average. This is almost 66 times as much as the 10 gwei that it has reached recently.
- However, the Ethereum network still remains rather high with more than a million transactions per day. Arcane research reports that the main reason for the recent drop in Ethereum has fees is due to the comparatively low trading volumes, and maybe the low-interest rates in the case of non-fungible tokens or NFTs.
- If we go back by a few years, it becomes noticeable that NFT transfers accounted for the majority of transactions that occured in the Ethereum blockchain. But the sudden drop in the interest rates in February 2022 has led to a huge drop in the demand for Ethereum.
- Trading volume on OpenSea fell from $247 million to $124 million from February 1 to February 6, which means the gas fee also fell from 134 gwei to 65 gwei. The NFT market has also fell from January 2022. The number of sales has fallen from near 64,000 sales per day in mid-January to almost 24,000 in mid-February.
About the author
Tiasha Chatterjee is a content writer with a great curiosity to learn about new things. Combining this curiosity with her interest in the English language, she loves to write about different subjects, including blockchain. When not writing, you’ll find her surrounded by her cats, soaking up another book.