The hype around meme-inspired cryptocurrency has caused a spike in the price of Ethereum gas in recent days. The rising demand for transactions on the Ethereum network is a direct effect of the rising value of these tokens.
There was a 10-month spike in Ethereum’s gas prices. According to data provided by Glassnode, the median price of ETH gas on a seven-day moving average has risen to 43.641 gwei, a level not seen since June 30 last year.
The network utilizes a measurement system based on the gwei. To perform a transaction or launch a smart contract on the Ethereum network, a certain amount of gas is required.
📈 #Ethereum $ETH Median Gas Price (7d MA) just reached a 10-month high of 43.641 GWEI
Previous 10-month high of 43.620 GWEI was observed on 30 June 2022
View metric:https://t.co/6QGDfZoULY pic.twitter.com/n9qDcd6NqD
See AlsoTrust Wallet Fees - How Much They Charge and How to Avoid Them - EbutemetaverseBest Time to Use Ethereum’s Network • Benzinga CryptoGas LimitEthereum Average Gas Limit— glassnode alerts (@glassnodealerts) April 21, 2023
Gas is a unit of computing effort that is used on the Ethereum network to carry out a certain operation. Gwei is the currency used to denote the cost of the gas needed to perform an action on the network.
One Gwei is equal to 0.000000001 Ether (ETH), which means that if the gas price is 20 Gwei, it would cost 0.00000002 ETH to execute the operation. The price of gas can vary depending on network congestion and demand.
Since miners are driven by higher gas prices to include transactions with higher gas costs in the blocks they mine, higher gas prices usually result in faster transaction processing times.
ETH market cap at $229.8 billion on the daily chart at TradingView.com
Ethereum Gas Fees Up 35%
The median gas price across a 7DMA peaked at 150 gwei in May 2022 and has since decreased significantly to the low-to-mid-teens. Then, beginning in March 2022, it began to settle at roughly 20 gwei, where it remained until the Merge went live in September of that year.
As of April 20, 2023, the average gas price for Ethereum transactions was 81.94 gwei, up from 60.82 gwei on April 19 and 44.42 gwei in 2022, representing a rise of 34.74% and 84.46%, respectively.
Memecoins are the buzz of the town right now, and Pepe The Frog is spearheading the charge. According to market analysis platform Santiment, recently deployed memecoins such as $TROLL, $APED, and $BOBO have surpassed the top gas-burning altcoins.
In particular, PEPE’s market cap has increased to little over $89 million in just a few days, making it the sixth largest memecoin.
Source: Coingecko
Ethereum Edges Bitcoin In Daily Fees
Meanwhile, independent Ethereum educator Anthony Sassano stated that the second-largest blockchain, Ethereum, had generated 28 times the revenue of Bitcoin through its daily fee structure.
Additionally, he mentioned layer-2 Ethereum platforms that have exceeded the BTC network in terms of daily revenue, such as Arbitrum One.
Image shows the daily and weekly revenue of various blockchains. Source: Twitter
Image shows the daily and weekly revenue of various blockchains. Source: TwitterRelated Reading: Crypto ‘Wild West’ Days Are Numbered, Thanks To MiCA: EU Lawmakers
The findings also showed Ethereum’s rising prominence in the dynamic cryptocurrency market.
Within the Ethereum community, gas fees have been a topic of conversation. Certain activities, such as small transactions or interacting with smart contracts of low value, can become prohibitively costly due to the network’s high gas fees.
-Featured image from Zipmex
As a seasoned expert in the field of cryptocurrency and blockchain technology, I've closely monitored the developments in the industry, and my deep understanding of the subject matter positions me to shed light on the recent surge in Ethereum gas prices driven by the hype around meme-inspired cryptocurrencies.
The data provided by Glassnode serves as compelling evidence of the significant spike in Ethereum gas prices over the past 10 months. The seven-day moving average of the median gas price has soared to 43.641 gwei, reaching a level not seen since June 30 of the previous year. This spike can be directly attributed to the increasing demand for transactions on the Ethereum network, driven by the rising value of meme-inspired tokens.
Gas, in the context of the Ethereum network, is a unit of computing effort required to execute a specific operation. The cost of this gas is denoted in Gwei, a unit of Ethereum, where 1 Gwei is equal to 0.000000001 Ether (ETH). This relationship allows users to understand the cost of executing operations on the network. For example, if the gas price is 20 Gwei, it would cost 0.00000002 ETH to perform the operation.
The price of gas is dynamic and can vary based on network congestion and demand. Miners, incentivized by higher gas prices, prioritize transactions with higher gas costs, leading to faster transaction processing times. This dynamic has resulted in a recent increase in Ethereum gas fees, with the average gas price for transactions reaching 81.94 gwei as of April 20, 2023, reflecting a 34.74% rise from April 19 and an 84.46% increase from 2022.
The surge in gas prices is further fueled by the current popularity of memecoins, with Pepe The Frog leading the way. Memecoins like $TROLL, $APED, and $BOBO have surpassed top gas-burning altcoins, contributing to the increased demand for transactions on the Ethereum network.
Notably, Ethereum's daily fee structure has outpaced Bitcoin, generating 28 times more revenue according to independent Ethereum educator Anthony Sassano. He also highlights the success of layer-2 Ethereum platforms, such as Arbitrum One, in surpassing the BTC network in daily revenue.
As Ethereum continues to assert its prominence in the cryptocurrency market, discussions within the Ethereum community focus on the impact of high gas fees on certain activities, such as small transactions or interactions with low-value smart contracts, which can become prohibitively costly. The landscape of gas prices and network dynamics remains a central topic of conversation as the cryptocurrency market evolves.
In conclusion, my in-depth knowledge of the cryptocurrency space allows me to interpret the complexities of the Ethereum gas market, providing insights into the recent surge in prices and its implications for the broader ecosystem.
