As the price of the cryptocurrency continues to rise, should we celebrate the decrease in Ether gas fees? First, let’s analyze the metrics driving this trend.
In fact, the average gas fee reached a low of $37.19, marking a 33.55% decrease from last Tuesday, when the average transaction fee was $56.
Another number we need to look at is the network’s hash rate, which has been marching to new heights since last week. Last Monday, Etherescan’s hash rate hit 812,769 GH/s. As of today, that number has reached a new high of 843,908.6252 GH/s, according to Etherescan.
Explaining the decrease in Etherescan gas costs
Now that we have laid out these numbers, let’s explore the interaction and relationship between them. While hash rates have increased, lower transaction fees may indicate a decrease in demand. In addition, while the price and computing power of Ether may now be sky-high, another metric has dropped considerably: transaction volume.
The Ether blockchain’s NFT transaction volume is cooling off. Last week, it recorded only $21 billion worth of transactions. Then, by Saturday, that number dropped significantly. Ether had about $14 billion in transaction volume. During that time, Ether’s market cap also dropped by $10 billion, and now stands at about $557 billion, according to CoinMarketCap.
Even the leading NFT marketplaces are reflecting this decline. OpenSea, the leading peer-to-peer marketplace, is a prime example of the gradual decline in monthly trading volumes. According to Dune Analytics, the platform’s Ether trading volume fell from $3.4 billion in August to $3 billion in September. It then slipped to nearly $2.64 billion in October – each step being a 12 percent month-over-month decline.
Meanwhile, leading NFT Collectibles wasn’t immune. trading volume for OG collectible CryptoPunk fell from $679 million in August to nearly $218 million in September. Last October, it fell further to $157 million last month, according to Cryptoslam.
Should we be concerned?
There is a consensus that despite the falling numbers, the NFT boom is far from over. Other projects have seen an increase in transactions from September to October. In addition, new NFT projects are being launched.
For example, game-making giant Axie Infinity launched its own decentralized exchange. katana. it went live last week with considerable draws on its in-game currency and governance tokens SLP and AXS. katana was heavily inspired by leading DEX SushiSwap and its sushi farming strategy.
Art marketplace SuperRare posted its best month ever with around $37 million in Ether trading volume, up from around $24.5 million in September. Fellow art platform Foundation also recorded its best month ever, with over $18.5 million in trading volume in October, up from $16.8 million in September.
In addition, Ethreum is on track to roll out a major network upgrade. Ethreum 2.0 promises to dramatically increase speed, reduce gas costs, and produce a greener carbon footprint.