Ethereum Transaction Fees Spike 498% as DEX Volumes and NFT Activity Surge

Coinbase analysts David Duong and David Han said that the spike in transaction fees was due to a surge in onchain activity on Ethereum.

Ethereum (ETH) network transaction fees have surged to their highest levels in two months as a recent uptick in onchain activity appears to be driving up the cost of transferring Ether and interacting with the blockchain.

According to data from Coinbase, the average Ethereum gas fees over the last two weeks were 498% higher than the monthly average, with the median transaction cost rising from $0.09 at the beginning of the month to $1.69.

Coinbase analysts David Duong and David Han said that the spike in transaction fees was largely due to a surge in onchain activity on the Ethereum network.

“There has been no single driver of increased activity,” the analysts said, highlighting several contributing factors, including decentralized exchange (DEX) volumes which have increased slightly, up 9% week-on-week.

Total Ether transfer volumes have also risen by 17% week-on-week, corresponding with the higher transaction fees, the analysts added.

Increasing onchain activity is evident in upticks in gas fees, which, according to blockchain efficiency firm Gashawk, has spiked to 40 gwei several times over the last week.

The increased onchain activity and transaction fees also caused a surge in total Ether fees burnt daily, rising over 900% to 2,097 ETH between Sept. 14 and Sept. 24, per data from CryptoQuant.

Meanwhile, data from DappRadar shows that decentralized application (DApp) volumes have almost doubled over the last 24 hours, up 97% to $3.6 billion. Similarly, non-fungible token (NFT) volumes have also increased by 17% on the day, reinforcing the increasing activity on the Ethereum blockchain.

From a technical perspective, Ether’s (ETH) price has broken above a key downtrend line that began at March’s multi-year high of $4,093, signaling a possible bullish shift in ETH’s short-term momentum.

ETH/USD daily chart. Source: TradingView

Despite the positive shift in momentum, Ether still remains sealed below its 100-day and 200-day exponential moving averages (EMAs), which currently sit at $2,770 and $2,864, respectively.

These EMAs continue to act as barriers and bulls will be required to flip them into support to confirm a sustainable recovery.

Meanwhile, Ethereum investment products broke a five-week negative streak, posting inflows of $87 million, “the first measurable inflows since early August,” according to the latest report by CoinShares.

This was largely driven by inflows into spot Ethereum exchange-traded funds (ETFs), which recorded $58.7 million in inflows on Sept. 27, according to data from Farside Investors.

BlackRock’s ETHA continues to see positive flows with inflows of $11.5 million on Sept. 27, as its net inflows surpasses $1 billion.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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