Transaction fees for Bitcoin and Ethereum drop to the lowest point in 7 months

Bitcoin and Ether transaction fees have dropped to their lowest levels in months as the cryptocurrency market faced a tumultuous week in 2024.
On June 23, the average Bitcoin transaction fee fell to $1.93 per transaction, the lowest since October 2023. The decreased fees indicate reduced network activity and less competition.


Bitcoin transaction fees. Source: Ycharts
Transaction fees on the Bitcoin network often surge during periods of high market volatility, particularly when prices increase. Increased price speculation leads to greater competition for block space.
As a result, every major bullish period since 2012 has resulted in a corresponding increase in fees, except for the 2021 bull run when Bitcoin (
BTC
) hit $69,000, but transaction fees remained relatively low.


BTC transaction fee with price highs. Source: Galaxy Digital
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Bitcoin price loses ground as TON, PEPE, KAS and JASMY catch traders’ attention
ETH gas fee nears historical lows
Conversely, Ether (
ETH
) gas fees have also reached a new low, with gas prices dropping to as low as 1 gwei, the lowest in years. The current gas fee on the Ethereum network is around 4.5 gwei.
Gwei is a denomination of Ether used on the Ethereum network for buying and selling goods and services. One gwei is equivalent to one-billionth of an ETH.


ETH gas fee. Source:
unnawut
The low gas fee on Ethereum is attributed to activity shifting from Ethereum’s base layer to its layer-2 network after the
March Dencun upgrade
.
Since the Dencun upgrade, average gas prices on Ethereum have decreased by about 92%. According to a report from Layer2 Insider, the layer-2 networks made $950,000 in the last week.


ETH L2 network fees. Source: Layer2 Insider
Crypto market chaos
The low transaction fees on the top two cryptocurrency networks come at a time when the crypto market is experiencing one of the worst weeks in 2024. Bitcoin’s price dropped below the $63,000 support level while several altcoins saw double-digit losses.
The crypto market has seen significant growth over the last six months, with top cryptocurrencies like Bitcoin and a few altcoins reaching new all-time highs.
However, in recent weeks, the bears have dominated, liquidating billions from the leveraged market and causing heavy losses for spot holders as well.
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