Gas fees on the Ethereum network have plummeted to their lowest point in six months, even as the value of Ether (ETH) experienced a modest rise over the weekend. Analysts at Santiment, a prominent crypto analytics platform, stated that this trend may foreshadow an impending surge in alternative digital currencies.
According to Santiment’s report released on April 28, the average fee for an Ethereum transaction dipped to a noteworthy $1.12 on April 27. Santiment’s analysis underscores the cyclic nature of trader sentiment within the crypto space, noting that transaction fees often mirror these oscillations between extreme optimism and pessimism.
The report explains that fee levels typically peak during periods of exuberance in the market and subside during phases of consolidation or downturns. This pattern was particularly evident in February of this year when gas fees soared to an eight-month high amidst fervent interest in an experimental token standard known as ERC-404.
Santiment’s interpretation of the current low gas fees suggests a potential resurgence in Ethereum network activity, signaling the onset of a broader altcoin rally. The report suggests that the recent market retracement, coupled with reduced network congestion, may catalyze a quicker turnaround for Ether and associated alternative cryptocurrencies than anticipated by many investors.
Concurrently, Ether prices have experienced a modest uptick, recording a 4.3% gain over the past week, as per data from CoinGecko. Notably, on April 27th, Ethereum layer-2 networks such as Optimism (OP), Arbitrum (ARB), and Polygon emerged as among the top five best-performing assets within the top 50 cryptocurrencies by market capitalization, with gains ranging from 2.8% to 11.7%.
Despite these positive indicators, a decline in network activity has led to a surge in the circulating supply of Ethereum over the past month. Data from ultrasound.money reveals that in the last 30 days, 74,458 new ETH were issued, outpacing the 57,516 ETH burned during the same period, resulting in a net supply increase of 16,979 ETH.
