In November, Ethereum’s Layer-2 networks tripled data uploads since March, after the Dencun upgrade cut earnings by 95%.
Researchers in the cryptocurrency industry and onchain data predict that the activity on layer-2 (L2) scaling networks will increase demand for data storage, which will lead to a recovery in Ethereum’s network earnings.
According to statistics provided by Dune Analytics, Ethereum L2s have been uploading up to three times more transaction data to the mainnet on a daily basis in the month of November compared to the amount of data they posted annually in March.
Since the network’s March Dencun upgrade transferred L2 transaction data to temporary offchain repositories dubbed “blobs” in an effort to decrease expenses for users, Ethereum’s profits dropped by as much as 95%, according to statistics from asset manager VanEck.
Matthew Sigel, the head of digital asset analysis at VanEck, said in an article that appeared on the X platform on November 1st that “ETH Fees Were Weak Due to Lack of Blob Revenues as L2s Have Not Filled Available Capacity.
According to Sigel, “There is some evidence that this is changing, thanks to Base, Scroll, and World Chain,” which are three of the most popular L2s for the time being. Sigel predicted in a September statement that Ethereum will generate up to $66 billion in annual free cash flow by 2030.
We expect this to drive the spot price of Ether to as high as $22,000 per cryptocurrency. He estimates the expected value for ETH holders due to transaction fees, as Ethereum processes a growing percentage of global transactions.
Ethereum processed about four trillion dollars’ worth of settlement value in the previous year, and it processes another five trillion dollars’ worth of stablecoin transactions annually. Therefore, this is significantly more significant than PayPal, and it is starting to approach networks such as Visa,” Sigel explained.
Sigel claims that since its initial introduction in 2015, Ethereum has generated almost three billion dollars in fees (denominated in ETH). Other mechanisms for the accumulation of ETH value include “burning” a portion of transaction fees, which means permanently removing it from circulation, and emitting fresh ETH to compensate stakers, who put ETH as collateral to secure the network.
The price of Ethereum (ETH) increased by ten percent on November 6th, following the victory of crypto-friendly Republican Donald Trump in the presidential elections of the United States.
While this was going on, spot Ether exchange-traded funds (ETFs) in the United States had net inflows of $52.3 million, which was the greatest amount seen in the past six weeks.
According to Edward Wilson, an analyst at Nansen, the success of Donald Trump in the presidential election could open the way for additional crypto-investing products to join the markets in the United States. These products could include the first staked Ethereum exchange-traded funds (ETFs).
There are several protocols that are competing with Ethereum in terms of the availability of data. There are several competing protocols, some of which include Celestia, EigenDA, and Avail.Â
