FameEX Hot Topics | Ethereum Users See Higher Fees Amid Increasing On-Chain Transaction Costs

Since September 15, 2024, on-chain fees on the Ethereum network have risen notably, climbing from $1 per transaction to $5.08 by September 20. Although they briefly fell to just over $4 on September 23, the average transaction cost surged again, reaching 0.0027 ETH (approximately $7.06) by Tuesday morning.

Over the past week, Ethereum (ETH) has outperformed Bitcoin (BTC) in terms of market gains, with ETH rising by 15.9% compared to BTC’s 9% growth. This increase in price has coincided with a rise in on-chain fees, with Ethereum transactions now averaging $7.06. Etherscan’s gas tracker shows that a typical high-priority Ethereum transaction fee is around $1.07 or 14.411 gwei. Due to previously lower fees, Etherscan recently began using decimal points for gwei estimates to provide more accurate calculations.

More complex transactions on the Ethereum network are also facing higher costs. Token swaps currently average $37.69, NFT sales stand at around $63.70, bridging fees are $12.12, and borrowing fees reach $31.98. In contrast, Bitcoin's transaction fees have remained more stable, averaging 5 satoshis per virtual byte (sat/vB) or roughly $0.848 per transaction. High-priority Bitcoin transaction fees are even lower, ranging around $0.18 or 2 sat/vB, according to data from mempool.space. Despite the rising fees, Ethereum remains inflationary, with an annual inflation rate of 0.367%.

Since the London hard fork, which introduced a major fee-burning mechanism, Ethereum's supply has increased by 0.858% annually. Since the fork’s implementation on August 5, 2021, approximately 3,153,785 ETH has been issued, bringing the current supply to over 120 million ETH. If Ethereum had continued using the proof-of-work (PoW) system, its supply would have expanded by 3.23%, adding around 11.2 million ETH. The London upgrade, however, has led to the burning of about 4.3 million ETH, resulting in a net issuance of just 7.53 million ETH.

In conclusion, Ethereum's on-chain transaction fees have risen significantly, impacting both simple and complex transactions, while Bitcoin's fees remain more predictable. The fee-burning mechanism from the London hard fork continues to shape Ethereum's supply dynamics, moderating its inflation rate.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.