Despite Proof of Stake Delay, Ethereum Gas Fees Have Dropped By 67% in the Last Seven Weeks

Gas fees, the payments made by users to perform a transaction on the Ethereum network, have been a consistent hurdle for most Ethereum users since the network’s inception. While they are necessary for the network to function, the exorbitant level of its gas fees have been a turn-off for many.

A year ago, Ethereum proposed a network transition to proof of stake, which is more energy efficient than the current proof of work model, and would theoretically lead to a reduction in the network’s gas prices.

Gas Prices Reduce Despite Delays to PoS Transition

As the Kintsugi Testnet went live on December 20th, Ethereum revealed that the PoS transition will be delayed until June 2022. However, while the PoS transition has been delayed, gas fees on the network are already dropping.

There has been a steady drop in the level of Ethereum’s gas fees, which has now reached its lowest level of the past six months. 

In the last seven weeks, the Ethereum network has seen a 67% drop in the average price of transaction fees – from $62 on November 9th, to $20.61 on December 27th.

The average transaction fees on the Ethereum Network in 2021

On December 27th, metrics show that the average fee spent on the Ethereum network is now $20.61, or 0.0051 Ether per transaction. 

To add to this, the median ether fee has also declined by 70% in the same period. On November 9th, the median ether fee, which was previously $34.28 per transaction, is now 0.0032 ETH or $10.43.

The median transaction fees on the Ethereum Network in 2021

On the Flipside

  • Layer 2 solutions still provide a cheaper alternative, with Loopring boasting fees of as little as $0.16 per ether transfer, and Polygon Hermez charging $0.25.

Why You Should Care

The drastic reduction in Ethereum’s gas fees on the Ethereum network proves that the problem can be solved when the network eventually migrates to a PoS consensus mechanism.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Milko Trajcevski

Milko Trajcevski is a DailyCoin news reporter, mainly focused on Ethereum (ETH), Cardano (ADA), and their founders (Vitalik Buterin and Charles Hoskinson). Milko is an avid follower of crypto and blockchain technology and has written thousands of articles on the subjects. He finds joy in transforming complex issues into written content that anyone can understand. Milko has used and analyzed numerous exchanges, such as Coinbase, FTX, and Binance. He also closely follows all of the latest news around the largest decentralized exchanges (DEXs). Location: Skopje, Macedonia