Ethereum gas fees drop to all-time low amid declining whale activity

Ethereum’s gas prices and whale activity have decreased as its price dropped below $2,600.

According to CryptoQuant’s X post, the daily average gas price on the Ethereum (ETH) network hit an all-time low of 2.9 Gwei, or about $0.026, on Aug. 18. The average ETH gas price has seen a slight increase and is currently at 3 Gwei.

Data shows that just 115 ETH (worth around $300,000) was burned as gas prices reached ATL, with the price consolidating around $2,600 amid market uncertainty.

One of the main reasons behind the massive drop in Ethereum gas price is the Dencun upgrade that was launched in March this year. Dencun allowed layer 2 networks to execute data blobs on the Ethereum mainnet, resulting in a significant fee reduction.

However, CryptoQuant analyst claims that falling network fees could lead to long-term problems such as “user and liquidity fragmentation.”

The analyst noted that despite the long-awaited approval of spot ETH exchange-traded funds in the US, the ETH supply increased by 197,000 tokens, while the price fell by 35%.

Ethereum’s whale activity has also been declining along with its fees. According to data from Santiment, the number of whale transactions involving at least $100,000 worth of ETH has steadily declined over the past week — down from 5,371 on Aug. 12 to 2,138 unique transactions at the time of reporting.

ETH price and whale activity – August 19 | Source: Santiment

ETH is down 3% in the last 24 hours and is trading at $2,580 at press time, but its daily trading volume has increased by 32%, surpassing the $10 billion mark.