Ethereum reduces its transaction fees, but it is not due to an improvement in scalability

The Ethereum network has seen a significant decrease in its gas fees, reaching levels not seen since September 2024. However, analysts at The Block Research point out that this drop is not due to improvements in scalability, but rather to low demand for network use.

In the most recent edition of its newsletter Data & Insights According to The Block Research, experts have noted that gas fees on Ethereum have experienced a notable decline in recent weeks, reaching levels not seen since September 2024. 

While this decline could be a cause for interest in the crypto community, the firm's experts have tempered their enthusiasm, assuring that this decrease is not due to significant improvements in the network's scalability, but rather to a low demand for transactions and activity on the chain.

Why have Ethereum gas fees decreased?

The observed decline in Ethereum transaction costs could at first glance be interpreted as a technical breakthrough, especially at a time when the network is preparing for its next upgrade, Pectra, designed to improve its efficiency and capacity. However, data from The Block shows that the network is experiencing a period of slowness, with on-chain volume having dropped noticeably compared to previous months.

As Ethereum developers work tirelessly to implement improvements that will allow the network to handle larger numbers of transactions more cheaply and efficiently, the current decline in gas fees reflects a more cautious market environment. 

According to analysts, Ethereum gas fees, which measure the cost of conducting transactions on the network, fell to $0,77 on February 15, which is a 70% decrease compared to the previous week. This level in the average network commission rate was observed in September last year. 

Analysts point out that this drop reflects low transaction demand on the network. Ethereum’s on-chain volume fell to just $4.190 billion on Saturday, February 17, down 46% from the previous week. This decline puts transaction volume at its lowest level since November 2024, just after the US presidential election, analysts said. 

The relationship between transaction demand and gas fees is straightforward: when more people use the network, transaction costs increase due to congestion. Conversely, when activity decreases, costs decrease. In this case, low demand suggests that fewer users are interacting with the network, which has led to a natural decrease in transaction costs.

What is Ethereum doing to improve?

Although the current decrease in gas fees is not due to improvements in scalability, it is well known that Ethereum developers are actively working on solutions that allow the network to handle more transactions more efficiently and at a lower cost. One of the most anticipated developments is the next update Pectra, which will take place in April 2025.

The Pectra upgrade is part of Ethereum’s broader plan to improve its scalability and capacity. While not the final solution to congestion issues, this upgrade will introduce improvements to transaction management and overall network efficiency. Additionally, Pectra will lay the groundwork for the implementation of other key solutions that will help deliver a more optimized experience for users on the mainnet. 

This upgrade is one of the most important steps on the path to a more efficient, scalable, and sustainable Ethereum. While it won’t solve all scalability issues in one fell swoop, Pectra will introduce significant improvements to the network architecture that will lay the groundwork for future improvements.

Therefore, although experts point out that the recent decrease in Ethereum gas fees is not due to improvements in scalability, but rather to a low demand in the use of the network, it should not be forgotten that Ethereum developers are actively working on solutions that will allow the network to operate more efficiently and scalably in the future and that Pectra is a key development in this entire process.

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