There was a 498% increase in Ethereum Transaction fees in conjunction with an increase in Ethereum network activity. Will the price of Ether adjust?
Coinbase has reported that Ethereum transaction fees have increased substantially in the past two weeks due to increased onchain activity.
The average Ethereum gas fees between Sept. 16 and Sept. 26 were 498% higher than the monthly average, according to Coinbase‘s weekly report, which was published on Sept. 27. The median transaction cost increased from $0.09 at the beginning of the month to $1.69.
Ethereum transaction fees and ETH transfer volumes
According to David Duong and David Han, analysts at Coinbase, the increase in transaction fees was precipitated by an increase in onchain activity on Ethereum.
The analysts stated that there has been no singular driver of increased activity, but they did identify several contributing factors. One of these factors is the slight increase in Ethereum decentralized exchange (DEX) volumes, which has increased by 9% week-over-week.
“USDC deposit rates on lending platform Aave have also moderately increased from 3.5% to 4.5%, suggesting a slight increase in leverage.”
Furthermore, the analysts noted that the total volume of Ether transfers has increased by 17% every week, coinciding with an increase in transaction fees.
Ethereum transaction fees have increased to 40 gwei on multiple occasions in the past week, indicative of the growing onchain activity reported by blockchain efficiency firm Glasshawk.
“ETH Gas has spiked above 30-40 gwei and then back down to 5-10 gwei, numerous times in the last 7 days.”ETH gas fees between Sept. 21 and Sept. 27
The total Ethereum transaction fees consumed daily increased by over 900% to 2,097 ETH between Sept. 14 and Sept. 24, as evidenced by data from CryptoQuant, due to the increased onchain activity and transaction fees.
In the interim, DappRadar data indicates that DApp volumes have nearly doubled in the past 24 hours, increasing by 97% to $3.6 billion. Likewise, the Ethereum blockchain’s activity has been bolstered by a 17% increase in NFT volumes on the day.
The price of ether surpasses a critical indicator
From a technical standpoint, Ether’s (ETH) surpassed the relative strength index (RSI) downtrend line established at the multi-year high of $4,093 in March, indicating a potential bullish shift in ETH’s short-term momentum.
Despite the positive momentum shift, Ether remains below its 100-day and 200-day exponential moving averages (EMAs), currently at $2,770 and $2,864, respectively.
It will be necessary for bulls to convert these EMAs into support to verify a sustainable recovery as they continue to function as barriers.
Additionally, Ethereum investment products experienced their first measurable inflows since early August, as evidenced by the $87 million inflows that broke a five-week negative trend, as CoinShares’ most recent report reported. According to data from Farside Investors, this was primarily due to inflows into spot Ethereum ETFs, which recorded $58.7 million in inflows on Sept. 27.
BlackRock’s ETHA continues to experience favorable flows, with inflows of $11.5 million on Sept. 27. Its net inflows have surpassed $1 billion.
