Gas fees on the Ethereum network fell to a 6-month low even as ETH prices increased slightly over the weekend. Accordingly, analysts from the Santiment platform believe that it could signal an upcoming altcoin price increase.
On April 27, the average fee for an Ethereum transaction dropped to as low as $1.12, according to an April 28 X post from Santiment.
“Traders have historically moved between psychological cycles when they felt the cryptocurrency was “To the Moon” or “It is Dead,” which can be observed through transaction fees.”
Source: Santiment
Santiment explains that fees tend to peak around local market peaks and fall back to “resting” lows around the time the market bottoms.
Gas fees on Ethereum hit an eight-month high in February this year amid a surge of interest in an experimental token standard called ERC-404.
The analytics platform suggests low gas fees could indicate future growth in Ethereum network activity and herald the start of altcoin price increases.
“With the market largely in retreat over the past 6 weeks, lack of demand and network stress could help the rotation into ETH and related altcoins sooner than many expect.”
It comes as the price of ETH surged slightly, up more than 4% on the week.
On April 27, layer 2 networks Ethereum Optimism (OP), Arbitrum (ARB) and Polygon accounted for three of the five best-performing assets in the top 50 cryptocurrencies by market capitalization, up 11.7 %, 3.5% and 2.8 % respectively.
Source: Luke Martin
Meanwhile, a drop in activity on the network has caused circulating Ethereum supply to rise to its highest level last month.
Over the past 30 days, 74,458 new ETH were issued while only 57,516 ETH were burned, resulting in a net supply increase of 16,979 new ETH, according to ultrasound.money data.
This is in complete contrast to the previous 5 months, when there was continuous deflation. Despite the recent increase in ETH inflation, over 437,000 ETH have been burned since the network switched to a PoS consensus mechanism, known as The Merge which occurred on September 15, 2022.
Source: https://tapchibitcoin.io/santiment-phi-ethereum-thap-trong-6-month-for-thay-mua-altcoin-dang-den.html
