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Ethereum Transaction Fees Fall by 58%—But They’re Still Expensive

Ethereum is quickly becoming a playground for the rich.

Republished by Plato

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In brief

  • Ethereum’s average transaction fee fell by 58% on Friday.
  • It since has slightly increased.
  • Scaling solutions are in the works.

If there’s one good thing that came out of this week’s Ethereum price crash—aside from its rebound today—it’s that Ethereum’s transaction fees plummeted.

On Wednesday, the average transaction fee on Ethereum hit $14.5, per data from BitInfoCharts. That’s the highest average cost of an Ethereum transaction since 2018.

(For reference, people must pay transaction fees on Ethereum whenever they want to move money around to different wallets, or use it in different protocols. This means that the average cost of doing so is $14.5).

But then the price of Ethereum, the second-largest cryptocurrency by market cap, crashed, from $487 on Wednesday to $390 on Friday, a decline of 20%. Along tumbled its average transaction fee, which collapsed to $6.1 on Friday, a drop of 58%.

Note that Ethereum’s crash doesn’t quite coincide with the transaction fee. The price of Ethereum continued to fall to $317 today—19% lower than its Friday ebb. But the average cost of an Ethereum transaction increased slightly, to $7.6 yesterday.

And the news that fees have fallen isn’t…great. Even if the rest of this week were counted as an outlier, yesterday’s average Ethereum transaction fee, $7.6, would still be its highest since 2018.

In part, these super-high transaction fees are due to the increased activity on Ethereum. Interest in the coin has grown since this summer’s rise of DeFi, or decentralized finance—non-custodial financial services like loans, synthetic stocks and decentralized exchanges. Investors have poured $8 billion into its smarts contracts since June.

Pretty much all of the major DeFi protocols these days live on Ethereum—hence the increased activity.

But these transaction fees are also incredibly high because Ethereum is fit to burst. Network utilization hovers around 96%—should it get much higher, the network will clog up and become unusable. Scaling solutions are in the works and Ethereum 2.0, an upgrade to the blockchain that will vastly increase its capacity, is due to go out later this year.

Disclaimer

The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.

Source: https://decrypt.co/41018/ethereum-transaction-fees-fall-by-58-but-theyre-still-expensive

Blockchain

Why this trend of Bitcoin and Ethereum is ‘completely fine’

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Since Bitcoin has been stealing the limelight with its crazy price movements, Ethereum was somewhat forgotten in the midst of this volatility. And thus, ETH started imitating BTC. Higher highs, lower lows, price spikes, and crashes, all looked a little too similar for both the coins. Why is ETH behaving in such a manner and what is it about to do next?

Surprisingly the answer to Ethereum’s questions can be found in Bitcoin’s movement. And for that very reason, these two cryptocurrencies have established some pretty crucial levels for the next few days.

Bitcoin has a fan!

Given Ethereum’s movement over the last few days, it does appear to be the case that the 2nd-gen coin is closely following the king coin’s price action. In the last 2 weeks alone, both cryptos have noted an unnaturally similar movement. Looking at the movement during the 13 June rally, the gradual decline until 19 June, the consolidation period until 21 June, and the 72 hours of volatility that ensued after, appear all but the same.

Bitcoin 12-day price movement (4-hour chart) | Source: BTC/USD – TradingView

Ethereum 12-day price movement (4-hour chart) | Source: ETH/USD – TradingView

The only difference that separates the two is the on-chain exchange flows which, in the case of Ethereum, have been much lower than expected.

Critical levels to watch put for

Despite these similarities, both coins have different important levels going forward. While BTC might be retesting the $32,000-level (black line) as support, it creates a possibility of a hike from this point. In fact, according to popular analyst DonAlt, if Bitcoin manages to close in the $35,000-range, a rally up to $45,000 can be definitely expected.

Important Bitcoin test levels | Source: Rekt Capital

On the contrary, Ethereum has a few critical ranges where it can shine going forward. Trader and analyst Michael van de Poppe remarked that over the next few trading sessions, ETH must hold within the $1700 – $1900 levels. Should this zone act as support, going forward the coin can potentially test $2300 or even $2600, based on how far it rallies.

Critical Ethereum test levels | Source: Michael van de Poppe

Similarly, well-known trader Nico found that ETH’s movement might not be looking quite strong at the moment. However, moving ahead, if ETH manages to maintain consolidation or engage in price appreciation, then $2200 can be observed as a strength test.

Ethereum strength test level | Source: Nico

Since these test and support targets are yet to sustain themselves, it is important to understand the present price action is not very weak either. As long as all coins manage to keep themselves from falling any further, the market would turn out to be positive. Don’t believe me? Then just listen to what Poppe says,

“Consolidation on the markets, that’s completely fine.”


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Source: https://ambcrypto.com/why-this-trend-of-bitcoin-and-ethereum-is-completely-fine

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Blockchain

Elon Musk Teases Bitcoin Maximilsts Once Again

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The CEO of Tesla, SpaceX, and The Boring Company, has taken another humoristic stab at BTC maxis by asking how many are needed to change a light bulb. The wave of comments didn’t disappoint from names like Michael Saylor, Dan Held, Raoul Pal, and more.

  • Ever since the start of the year when Musk said he regretted not buying bitcoin years ago and later revealed that his EV company had actually purchased $1.5B in BTC, the billionaire has frequently been engaging with the community.
  • Most of the discussions used to be in a positive manner, but it all changed when Tesla disabled BTC payments citing environmental issues. When Musk started bashing the cryptocurrency for its high energy consumption levels, most Bitcoin maximalists changed their tunes as well.
  • However, it seems that Tesla’s CEO sees most of it from a humoristic point of view and the latest example, which came earlier today, supports this idea.
  • He reiterated a popular question on Twitter – ”How many Bitcoin maxis does it take to screw in a lightbulb?” Later on, his own response was also quite ironic.
  • Some popular BTC maximalists and other cryptocurrency commentators quickly offered their opinion on the matter. Michael Saylor, the CEO of MicroStrategy, was among the first who also caught the irony – “if you give us 10 minutes, maybe we can hash out the answer,” referring to how the Bitcoin network works.
  • Peter McCormack, the podcaster who recently interviewed the President of El Salvador on the country’s BTC adoption, took a stab at Musk, while Raoul Pal spoke about his views on what the BTC maxi tribe represents.
  • Interestingly, Dan Held, the Head of Growth at Kraken, responded with a reference towards Elon Musk’s favorite meme coin – Dogecoin.
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Source: https://cryptopotato.com/elon-musk-teases-bitcoin-maximilsts-once-again/

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Blockchain

Bitcoin’s Dominance Rises as BTC Reached a 4-Day High at $35,500 (Market Watch)

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Although bitcoin failed to continue upwards after its intraday high of $35,500, its dominance over the market has increased further. This comes as most alternative coins have stalled, except for Dogecoin, which is up by double-digits.

BTC Dominance on the Rise

After the mid-week crash, in which bitcoin slumped below $30,000 for the first time since January, the asset’s performance has been calmer. It recovered most losses and even spiked to just shy of $35,000 on the following day but failed to continue higher as reported.

The bears drove it south to around $32,000, but the trajectory quickly reversed in the following hours. BTC started climbing again and added more than $3,000 of value.

As a result, it charted a four-day high of approximately $35,500. Despite losing over a grand since then, its dominance over the market has actually increased.

The metric comparing BTC’s market capitalization with all other cryptocurrencies is up to 47%.

BTCUSD. Source: TradingView
BTCUSD. Source: TradingView

Alts Stall While DOGE Pumps

Most of the alternative coins have remained stagnant on a 24-hour scale. Although Ethereum recovered from its most violent stages of the crash, it still fails to overcome $2,000 decisively. As a result, ETH trades just north of $1,900 for a second consecutive day.

Binance Coin jumped higher in the past 24 hours and even exceeded $310 at one point, but has retraced since then and is currently around $290. Cardano, Polkadot, Bitcoin Cash, and Chainlink are slightly in the red since yesterday.

In contrast, Ripple, Uniswap, Litecoin, and Solana have marked minor gains. Dogecoin is the most impressive performer once more from the larger-cap alts following a 10% increase to $0.26.

Cryptocurrency Market Overview. Source: Quantify Crypto
Cryptocurrency Market Overview. Source: Quantify Crypto

More fluctuations come from lower- and mid-cap alts. Celo (20%) has surged the most, followed by Nano (16%), Siacoin (12%), THORChain (12%), Curve DAO Token (11%), and Waves (10%).

Klaytn has lost the most from yesterday after a 14% drop. Nevertheless, the cumulative market capitalization of all cryptocurrency assets has remained just shy of $1.4 trillion.

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.


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Source: https://cryptopotato.com/bitcoins-dominance-rises-as-btc-reached-a-4-day-high-at-35500-market-watch/

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