TLDR
Ethereum gas fees have plummeted 70% to around $0.80 per transaction, marking a four-year low and dropping from previous highs of over $20 in 2024. Daily fees decreased from $23 million to $7.5 million.
Layer 2 solutions like Arbitrum, Optimism, and Base now handle over 1.5 million daily transactions, doubling from 800,000 a year ago, with fees as low as $0.15 after the Dencun upgrade.
Network activity on Ethereum’s mainnet has declined, with daily transactions falling from 1.2 million in January 2024 to approximately 900,000 in February 2025.
High priority fees on Ethereum have dropped to 0.924 gwei ($0.05), leading Etherscan to reintroduce decimal figures in their gas tracker.
Despite lower fees, Ethereum maintains over 1 million daily confirmed transactions, showing steady network usage unlike Bitcoin’s declining transfer activity.
The Ethereum blockchain has experienced a dramatic decrease in transaction costs, with gas fees falling 70% to reach their lowest levels in four years. According to data from IntoTheBlock, the average gas price has dropped to approximately 5 gwei, equivalent to $0.80 per transaction, down from over $20 during peak periods in 2024.
Daily fee revenue on the network has seen a sharp decline, dropping from $23 million to $7.5 million. The latest metrics from February 20, 2025, show high priority fees reaching as low as 0.924 gwei, or $0.05 per transaction.
The emergence and growing adoption of Layer 2 (L2) solutions have played a key role in this price reduction. Networks like Arbitrum, Optimism, and Base now process more than 1.5 million daily transactions combined, representing a substantial increase from 800,000 transactions a year ago.
These L2 networks have become more cost-effective following the recent Dencun upgrade, which introduced “blobs” to reduce data costs. The upgrade has resulted in up to 90% lower fees on L2 networks, with platforms like Arbitrum now charging an average of $0.15 per transaction, compared to $2 before the upgrade.
Base, one of the leading L2 solutions, has accumulated $8 billion in Total Value Locked (TVL), demonstrating the growing trust in these scaling solutions. The success of L2 networks has helped reduce congestion on Ethereum’s mainnet by processing transactions off-chain while maintaining the security benefits of the main network.
Network Data
Transaction activity on Ethereum’s mainnet has shown a decline, with daily transactions decreasing from 1.2 million in January 2024 to just over 900,000 in February 2025. This reduction aligns with a decrease in decentralized exchange (DEX) volumes, which have fallen to $2.62 billion daily from a 2024 peak of $5 billion.
The cryptocurrency’s blockchain explorer, Etherscan, has adapted to these lower fee levels by reintroducing decimal figures in its gas tracker. This change became necessary as fees fell below 1 gwei, the traditional unit used to measure transaction costs on the network.
The impact of the Dencun upgrade extends beyond fee reduction. Since its implementation, Ethereum issuance has exceeded burns by 197,000 ETH, approximately $500 million, indicating reduced fee pressure on the network.
Different types of L2 solutions contribute to the network’s efficiency in various ways. Rollups post data while reducing activity on the mainnet, while Validiums and Optimiums periodically post state commitments of transactions that are validated by Ethereum, though they don’t post data on the mainnet.
Interest in speculative activities, such as memecoin trading and NFT drops, has decreased, further reducing demand for block space on the main network. This shift in user behavior has contributed to the overall reduction in network congestion and fees.
Despite the decrease in fees, Ethereum continues to maintain strong network usage with daily confirmed transactions consistently exceeding 1 million. This stands in contrast to Bitcoin, which has experienced a decline in daily transfer activity during the same period.
The current gas fee structure represents a change from August 2024, when Etherscan first updated its tracker to include decimal figures. The reappearance of sub-1 gwei fees marks a return to these lower cost levels.
For context, one gwei equals one-billionth of an ether (0.000000001 ETH), serving as the standard unit for calculating transaction costs on the network, similar to how Bitcoin uses satoshis as its smallest unit.
In comparison, Bitcoin’s network currently charges around 3 satoshis per virtual byte for high-priority transfers, equating to approximately $0.41 per transaction.
While Ethereum’s onchain volume has decreased during this period, the network continues to process a high number of daily transactions, indicating sustained user activity despite lower fees.
