Gas Fees Skyrocket on Ethereum Network – Here is Why
Gas fees on the Ethereum (ETH) network have recently surged to a 10-month high due to the increased popularity of meme coins.
According to Glassnode, the median Ethereum gas price over a seven-day moving average reached 43.641 gwei, a price that was last seen in June 2022.
📈 #Ethereum $ETH Median Gas Price (7d MA) just reached a 10-month high of 43.641 GWEI
Previous 10-month high of 43.620 GWEI was observed on 30 June 2022
View metric:https://t.co/6QGDfZoULY pic.twitter.com/n9qDcd6NqD
— glassnode alerts (@glassnodealerts) April 21, 2023
The cost of using Ethereum has been a contentious issue since the “DeFi Summer” of 2020 when gas prices reached as high as 700 gwei. During this period, yield protocols like Curve, Compound, and Yearn saw a surge in network activity, prompting high demand for transaction verification.
Ethereum’s architecture means that high gas fees occur when network traffic and demand for transaction verification are high.
READ MORE: Ethereum: Significant Rise in Open Interest – What is Behind the Surge?
Although it was thought that the Merge and switch to PoS consensus would solve this problem, it has been confirmed that gas fees are mainly driven by the demand for blocks and the network’s ability to meet that demand rather than the consensus mechanism used.
Recently, the Ethereum network has experienced increased activity due to the release of meme coins such as PEPE, which quickly rose to become the sixth largest coin by market capitalization, reaching $89.1 million in just a few days.
This success has sparked speculation on social media about which meme coin will be the next to surge.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
