Bitcoin and Ether transaction costs have dropped to their lowest levels in several months as the crypto market suffered one of its worst weeks of 2024.
On June 23, the average Bitcoin transaction fee hit $1.93 per transaction, the lowest since October 2023. Low fees on the Bitcoin network indicate reduced network activity and less competition.
The transaction fees on the Bitcoin network often surge during times of high market volatility, particularly when prices rise. The heightened price speculation leads to increased competition for block space.
As a result, every major bullish period since 2012 has led to a corresponding increase in fees, except for the 2021 bull run, when Bitcoin (BTC) prices reached $69,000, but transaction fees remained relatively low.
On the other hand, Ether (ETH) gas fees have also hit a new low, with gas prices as low as 1 gwei, the lowest in years. The current gas fee on the Ethereum network is about 4.5 gwei.
Gwei is a denomination of Ether used on the Ethereum network to buy and sell goods and services. One gwei is one-billionth of one ETH.
The low gas fee on Ethereum is attributed to activity moving away from Ethereum’s base layer to its layer-2 network following the March Dencun upgrade. Since the Dencun upgrade, average gas prices on Ethereum have decreased by about 92%.
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 fell below $63,000 support, while several altcoins experienced 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 the past few weeks, the bears have been in control, liquidating billions from the leveraged market, while spot holders have also suffered heavy losses.