The average network fee on Ethereum, which is paid for making transactions on the blockchain network, is currently around $3 USD.
According to data consulted on the crypto analysis platform The Block Research, Ethereum's average transaction fee has decreased by 94,7% since last November, when it recorded an all-time high of $53,07 USD per transaction.
The network fee is a fee paid for sending transactions on the blockchain. This fee, which is measured in Gas, goes to Ethereum miners for their work in processing and confirming transactions.
This is a dynamic value that varies depending on the status and demand for activity within the network.
Source: The Block Research
The network fee on Ethereum began to increase gradually and significantly in mid-2020, to the point of becoming one of the main usage limitations for the blockchain, a product of the high demand and low scalability that the network has in its current state.
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Mining revenues are declining on Ethereum
The decline in the average network fee cost on Ethereum has been accompanied by a significant decline in the earnings of blockchain network miners.
Data from The Block Research shows that since November, miners' revenue has dropped by 73,4%.
Last November, monthly mining revenue on the Ethereum blockchain peaked at $2.070 billion, while in June, this revenue was just $549 million.
Within these values, the profit received by Ethereum miners through network fees was 10,9% in November and 5,75% last June.
Source: The Block Research
On the other hand, the platform's data shows that the adjusted on-chain volume, a metric that defines the economic performance of ETH on the network, has decreased by 59% since November, as has the number of transactions carried out within this blockchain and the number of active ETH addresses.
Solana and BNB Chain network fees are also reduced
Cryptocurrency monitoring platform CoinMarketCap noted on its Twitter account that the network fees on two other major blockchains in the crypto industry, Solana and BNB Chain, have also decreased considerably since last November.
CoinMarketCap noted that the reduction in network fees for Ethereum, Solana and BNB Chain is related to the decrease in transaction volume within these networks.
Cryptocurrencies are going through one of their worst crypto winters, which has caused the price of ETH, SOL and BNB to drop significantly on the market.
At press time, these cryptocurrencies are trading 70%, on average, below their current ATHs or all-time highs.
Ethereum is the most used blockchain in the crypto industry
Ethereum is the leading blockchain for developing decentralized applications and smart contracts.
Thanks to the high level of security offered by this blockchain network and its unique features, Ethereum has become one of the most active projects in development and use in the crypto industry.
According to DeFi Pulse, Ethereum is the blockchain ecosystem with the largest number of decentralized projects and protocols in development.
The data from this platform indicate that, at present, there are 515 DeFi protocols based on Ethereum; while on the other two popular blockchains, BNB Chain and Solana, the number of existing DeFi protocols is lower, with 424 and 72 protocols currently, respectively.
Source: DeFi Pulse
Although millions of people are currently using Ethereum’s DeFi protocols, the most popular being Uniswap and Curve Finance, due to the network’s inability to scale properly, Ethereum developers are building a new solution that they promise will improve its scaling capabilities, reduce its gas fees, and serve its community of millions of users.
Such a solution, called the “consensus layer” or Ethereum 2.0, could become a reality as early as this third quarter.
According to Ethereum lead developer Tim Beiko, the first phase of Ethereum 2.0, The Merge, which is the merging of the mainnet with the Proof of Stake (PoS)-based network, could happen as early as September 19.
Continue reading: From Terra to Polygon: Over 40 projects migrate to Ethereum's second layer
