24 Apr 2023 Arjun Agarwal
Ethereum Gas Fees Recorded A 10-Month High
The return of some volatile meme coins pushed Ethereum (ETH) to record a staggering 73% increase in gas fees. Several meme cryptocurrencies captured the eye of the crypto world during the past week.
In turn, ETH got exchanged for these extremely volatile assets, which were mostly traded on the Arbitrium [ARB] network. Data from IntoTheBlock shows that Ethereum made $66.7 million in gas fees during that time due to an increase in network resource consumption.
It is important to note that the increase in the Ethereum network traffic may result in congestion and higher fees in order for transactions to be validated.
Even though meme coins are regarded as high-risk investments that are prone to unexpected surges and crashes, many of them recently displayed an amazing performance.
Although the momentum slowed down, the boost indicates that a significant amount of ETH was being spent in transactions over the previous week. The average amount of gas utilized, however, has also decreased substantially.
Data from Santiment shows that the average amount of gas consumed for transaction validation has decreased to 43.99 Gwei. This showcases the traders' hesitation toward ETH exchanges for other cryptocurrencies.
Meanwhile, on April 23, Glassnode announced that the average gas price for Ethereum reached a 10-month high. There are several recorded instances where ETH gas costs rise during periods of increased demand for cryptocurrencies. As a result, the cost for the typical user increases in order to prevent network congestion.
Source: Glassnode
As of press time, ETH's exchange influx has decreased. The indicator, which shows how much of the altcoin is entering exchanges, sits at around 18,200.
However, since the meme tokens were exchanged primarily on Decentralized Exchanges (DEXs), there were a number of spikes throughout the week that indicated greater activity.
Ethereum`s price drops despite the gas surge
Meanwhile, the recent volatility in the price of Ethereum reveals a persistent market bearish trend. As bearish sentiment increases, the ETH/USD pair has dropped considerably over the past seven days, reaching the $1,850 level. The coin is currently in a bearish zone and is probably going to experience more short-term pressure.
As soon as the ETH/USD pair dropped below the psychological $1,880 barrier, the selling pressure increased. At first, this level offered solid support, but purchasers were unable to hold it, and the price dropped to below $1,850. At $1,842, researchers see a massive amount of support for the ETH/USD pair. The coin is anticipated to continue falling and test its next support at $1,800 if this level fails to hold.
Technical analysts believe that there is immediate resistance near the $1,900 region. It is quite close to where the main decline from the $2,125 swing high to the $1,827 low was retraced at a 23.6% Fib level. The next significant resistance is near the $1,920 price point.
Ethereum may move toward $1,975 or the 50% Fib retracement level of the main decline from the $2,125 swing high to the $1,827 low if the upward break above $1,920 occurs. The next significant barrier is located close to the $2,000 area, above which the price may begin to increase.
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