Ethereum Transaction Fees Increased, Anticipated Relief With Dencun Upgrade

ETH price has increased by nearly 60% in the last 30 days, trading at nearly $4000 level for the first time since December 2021.

Sophia Cruz•Friday, March 8, 2024•1 min read

The world’s second-largest cryptocurrency, Ethereum (ETH) has been experiencing a significant surge recently. ETH price has increased by nearly 60% in the last 30 days, trading at nearly $4000 level for the first time since December 2021. In addition to the price surge, there has also been a massive increase in its transaction fees.

Increased Demand Is Testing Ethereum Network’s Capacity

The Ethereum network has always been a busy platform. If more users are trying to do transactions, it will cause a slow effect on its performance causing more expensive transaction fees.

Earlier this month, Ether witnessed a staggering increase in transaction volume, noting a single-day recording of $50 billion — its highest level since 2022. The massive increase in activity has triggered transaction fees to go higher to a ten-month high, raising concerns about Ethereum’s scalability and accessibility for its users.

Good Thing Dencun Upgrade Is Coming

Ethereum developers are now gearing up for the Dencun upgrade, to commence on Wednesday, March 13. The upgrade will serve as the first step towards a “rollup-centric roadmap”, that creates smoother transactions on the Ethereum network.

Dencun upgrade leads the layer-2 blockchains to efficiently store data on the Ethereum network, resulting in cheaper transaction fees for its users. According to analysts, there’s a potential for near-zero fees for using layer-2 solutions that could attract new users to the Ethereum network.

Despite the recent spike in transaction fees, the ETH price continues to move upward. Ethereum (ETH) is currently trading at $3,924.10, 3.87% higher in the last 24 hours.

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ABOUT THE AUTHOR See More

Sophia Cruz

Financial Writer - Asian & European Desks

Sophia is an experienced writer, reporter and newsdesk member, mostly on the financial sectors. For the past 5 years Sophia has covered a wide variety of topics such as the financial markets, economics, technology, fin-tech and trading. Sophia has been a part of the FX Leaders team since 2017 and works on producing valuable content and information for traders of all levels of experience.