- The Ethereum network has undergone a remarkable drop in gas fees.
- Memecoin frenzy and MEV bot activities have propelled Ethereum to unprecedented heights.
- Established tokens have been replaced by memecoins in the top 10 gas-burning altcoins.
In recent weeks, the Ethereum network has witnessed a captivating transformation. After reaching unprecedented heights driven by the memecoin frenzy and maximal extractable value (MEV) bot activities, a cooling effect has finally descended upon gas fees on the Ethereum network.
This significant drop in fees comes as a relief to users who have grappled with soaring transaction costs. But what exactly caused this sudden change?
Memecoin Frenzy Overtakes ETH, WETH, and Tether in May
In late April, the memecoin frenzy took hold and continued to dominate throughout May, introducing numerous memecoins to the market, including Aped (APED), Bobo Coin (BOBO), and others.
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The dominance of memecoins even caused a shift in the top 10 gas-burning altcoins, replacing established tokens like ETH, Wrapped Ether (WETH), or Tether with memecoins like Troll (TROLL), APED, and BOBO.
Ethereum Network Sees Drop in Gas Fees in Early June
Gas fees on the Ethereum network have experienced a notable decline during the first week of June. The average gas fee has dropped to $7.34, marking a nearly one-third decrease compared to last month’s peak of $20. In terms of gwei, the daily median gas price has decreased from almost 140 gwei to 24 gwei, according to Dune Analytics.
While May witnessed the memecoin frenzy on Ethereum, it was also a significant period for Bitcoin Ordinals. These Ordinals provide decentralized storage of digital art on the Bitcoin blockchain, and they gained substantial traction.
Pepecoin Leads Ordinals’ Billion-Dollar Market Surge
The influx of new memecoins on the Bitcoin network, including Pepecoin (PEPE) with a billion-dollar market capitalization, showcased the interest in Ordinals.
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Introduced in January, Ordinals experienced tremendous growth by the end of May, with over 10 million inscriptions recorded on the Bitcoin blockchain. The fees paid for Ordinals inscriptions surged by 700% in May, reaching 1,639 Bitcoin.
On the Flipside
- While the memecoin frenzy dominated the Ethereum network, it brought an influx of low-quality and potentially fraudulent tokens, posing risks to investors and the overall reputation of the network.
- The shift in the top 10 gas-burning altcoins towards memecoins raises concerns among experts about prioritizing speculative and volatile assets over more established and fundamentally strong cryptocurrencies.
- The significant increase in fees paid for Ordinals inscriptions on the Bitcoin network may deter small artists and creators from participating.
Why This Matters
With soaring transaction costs being a significant concern, this development brings much-needed relief and improves accessibility to the Ethereum ecosystem. Additionally, the rise of memecoins and the growing interest in Ordinals on both Ethereum and Bitcoin networks indicate the evolving landscape within the crypto space.
To learn more about the potential for XRP Ledger to challenge Ethereum’s dominance, read here:
XRP Ledger Developer Touts Hooks as Key to Dethrone Ethereum
For the latest update on Rocket Pool’s groundbreaking feature that allows users to stake ETH on Ethereum Layer 2 using zkSync, click here:
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