Ethereum fees fall due to low activity
Ethereum gas fees drop to five-year low as user activity slows.
Ethereum (ETH), the largest altcoin by market capitalization, is facing mounting challenges as user activity declines and gas fees hit their lowest level in five years.
According to Santiment, the average transaction fee on Ethereum dropped to just $0.168—its lowest point since 2019—signaling a significant decline in on-chain activity, reports Cryptopolitan.
DeFiLlama data shows that Ethereum’s total value locked (TVL) in decentralized finance (DeFi) protocols fell more than 3% in the past week and 8% over the last 30 days, settling at $46.85 billion. Meanwhile, Solana is steadily gaining ground. The Layer-1 network saw its DeFi TVL rise by 4.4% in the past week to $7.07 billion, highlighting growing traction among developers and users seeking lower costs and higher throughput.
Low fees signal waning demand as whales exit
Ethereum’s low gas fees—averaging as little as $0.02—are typically seen when network demand wanes. Analysts suggest the current lull in activity could offer a rare window for developers to build and test applications more cost-effectively. Still, some view the situation as a sign of broader disinterest. Santiment noted that falling fees historically precede major price movements, hinting that volatility may return.
Ethereum’s price has dropped 61% over the past four months, with only a modest 2% rebound in the last 24 hours to $1,596. Trading volume currently sits at $13.6 billion. On-chain analyst Ali reported that large investors, or whales, have sold 143,000 ETH in the past week. He identified $1,528.50 as a key support level, where over 2.6 million addresses previously accumulated 4.82 million ETH.
Ethereum faces shifting sentiment and growing competition
Market sentiment appears to be turning against Ethereum. Once hailed as the backbone of decentralized applications, it is now seeing diminished engagement. Traders and developers have increasingly turned to alternative chains such as Solana, XRP, and Cardano. Notably, Ripple’s XRP is up year to date and trading at $2.09, while ETH has lost over half its value.
As macroeconomic uncertainty persists, Ethereum’s ability to regain user attention and on-chain activity may prove critical in maintaining its leadership in the evolving digital asset ecosystem.
Recently we wrote that Ethereum co-founder Vitalik Buterin has unveiled a new roadmap aimed at enhancing user privacy on the Ethereum blockchain.
