According to TechFlow, on August 19, cryptocurrency analysis company Kaiko Research released a report stating that Ethereum's gas fee recently hit a five-year low due to increased Layer 2 activity and the Dencun upgrade in March that reduced Layer 2 transaction fees.

This fee reduction has an important impact on Ethereum, as lower fees mean less ETH is burned, leading to an increase in the token supply. The total supply of ETH has continued to rise since April.

Despite demand drivers such as spot Ethereum ETFs, the growing supply may curb potential price increases in the short term.