According to Santiment's data, Ethereum's network costs have dropped to their lowest level so far in 2023, with an average of only $1.15 per transaction
According to Santiment's data, Ethereum's network costs have dropped to their lowest level so far in 2023, with an average of only $1.15 per transaction.
This marks a significant decrease in high fees in 2021 and 2022, when the demand for Ethereum transactions resulted in average fees exceeding $50, sometimes even hundreds of dollars.
The high network costs on Ethereum have always been related to the increase in network practicality and activities. When the cost is high, it indicates that the network is heavily used for transactions, smart contracts, and decentralized applications (dApps). However, its disadvantage is that the high fees deter smaller traders and traders.
Source:Santiment - Starting today
The recent cost decline is a positive signal for the practicality and adoption rate of Ethereum. More affordable transaction costs can promote the circulation of ETH tokens and make it easier for users to use dApps. Lower fees can also enable smaller transactions to be conducted online.
From a historical perspective, as ETH becomes cheaper to trade and circulate online, the practicality and adoption rate of Ethereum often increase. Higher utility and activities can help restore the overall market value and value of Ethereum. Recently, the average cost has dropped below $2, indicating that ETH has become more available for developers and traders. If this increase in affordability can bring more utility, it may help Ethereum recover some of the market value lost in the 2022 bear market.
Ethereum indicators display mixed signals
From the perspective of technical indicators, the recent price trend of Ethereum has been mixed. ETH is currently trading near the support level of $1600. The MACD (Moving Average Convergence Divergence) histogram is decreasing, indicating that the upper action energy is weakening. However, the MACD line is still above the signal line, which is a bullish signal.
In terms of support and resistance areas, if selling pressure increases, Ethereum will face support of around $1600 and $1500. On the upside, ETH will encounter resistance around $1800, approaching its previous support level, as well as the psychological levels of $2000 and $2140.
Traders will focus on whether Ethereum can maintain its network momentum while maintaining low costs. The increased adoption and practicality of Ethereum will help validate its long-term prospects as a leading blockchain network. But the cryptocurrency market is still unstable, so ETH needs to overcome technical resistance in order to convincingly rise.
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