While the second largest crypto asset by market capitalization, ethereum, has risen 27% against the US dollar over the past two weeks, the network’s medium and large gas fees have increased by more than 50%. On the first day of 2023, the average fee to spend ether was around $2.93 per transfer, but today the average cost is 54% higher at $4.52 per transfer.
An increase in Onchain Transaction Costs as a result of a rise in the value of Ethereum
Sending ethereum (ETH) becoming more expensive as the value of the crypto asset has increased significantly over the past 14 days. At the time of writing, ether is trading at $1,542 per unit, after reaching a high of $1,606 per unit during the same 24-hour period on January 18, 2023.
As the value of ethereum in US dollars has increased, so has the cost of moving ether and the multitude of ERC20 tokens. Details from bitinfocharts.com indicates that the average ether gas fee is $2.93 per transfer on January 1, 2023. 18 days later, the average fee to send ethereum is 54% higher at $4.52 per transaction.
Bitinfocharts.com’s medium-sized ethereum fee chart shows a similar pattern. 18 days ago on the first day of 2023, bitinfocharts.com’s median ether fee chart showed that the cost to send ethereum was about $1.06 per transfer.
On Wednesday, the same chart showed that the cost has risen to 0.0013 ETH per transfer or about $1.96 using current ether exchange rates. That means the average ethereum fee has jumped 84% since January 1st. In addition, although the gas measurement is usually estimated at a much lower rate, etherscan.io’s «Gas Tracker» also shows an increase since the beginning of the year.
On that day, the web portal fee tracker shows that the premium ether gas fee was over $0.30 per transfer or 20 gwei. 18 days later, there is still a high priority fee of 20 gwei or $1.14 per ETH transaction, which represents an increase of approximately 280%. On January 1st, the cost of transactions with Opensea was estimated at $1.12 per transaction and today up to $3.99.
A swap on a decentralized exchange platform (dex) was $2.87 and now it’s up to $10.28 to trade on a dex like Uniswap. Sending an ERC20 token USDT and USDC would cost a sender about $0.84 per transaction, and today about $3.02 to send ERC20.
In addition, the cost of layer two (L2) transactions has also increased. Three days ago on January 15, 2023, Topcripto.net News reported an increase in Arbitrum and Hope transactions. On that day, Arbitrum’s network transfer was about $0.101 per transfer, and today’s fee is about $0.188 per transfer, according to details from Dune Analytics.
Likewise, Optimism network transaction costs were $0.1410 per transfer three days ago, and as of January 18, the cost to transfer coins on the L2 Optimism chain is $0.3039 per transaction. The rise in ether gas fees has been higher in recent years after breaking the record of many months of low fees on the Ethereum network.
How do you think the increased gas fees will affect the Ethereum network and its users? Share your thoughts in the comments below.
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