When no one is making a purchase, a strange silence descends upon a marketplace. The closest thing you can get is to look through Ethereum’s mainnet activity logs these days. A network that used to cost users hundreds of dollars per transaction is now processing transfers for actual pennies, sometimes fractions of a cent. Gas prices have decreased to levels not seen since 2019. That ought to be a reason to rejoice. It’s not that easy, somehow.
For the majority of the first part of 2025, average gas prices have been between 0.37 and 0.40 gwei, which is hardly noticeable. For background, fees surged above 83 gwei in March 2024. In about a year, that is a collapse of over 95%. Regular users can now exchange tokens on Uniswap for pocket change, despite previously complaining bitterly about having to pay $30 to do so.
| Category | Details |
|---|---|
| Network Name | Ethereum |
| Founded | July 30, 2015 |
| Founders | Vitalik Buterin, Gavin Wood, Joseph Lubin (and others) |
| Headquarters | Decentralized (Ethereum Foundation based in Zug, Switzerland) |
| Native Token | Ether (ETH) |
| Consensus Mechanism | Proof of Stake (since “The Merge,” September 2022) |
| Current Avg. Gas Fee | ~0.37–0.40 gwei (as of early 2025, near historic lows) |
| All-Time High Gas Fee | ~83.1 gwei (March 2024) |
| Key Upgrades | London Hard Fork (EIP-1559, 2021), Dencun (EIP-4844, March 2024) |
| Official Reference | ethereum.org |
More frequent position rebalancing is possible for DeFi farmers. Without worrying about the gas bill, NFT creators can mint. This appears to be everything the Ethereum community could possibly want. The source of the silence is the issue.
Depending on your point of view, the Dencun upgrade in March 2024 deserves a lot of praise or criticism. Through EIP-4844, it introduced “blobs” as a way for Layer-2 rollups such as Base, Arbitrum, and OP Mainnet to more affordably post transaction data to Ethereum’s consensus layer, avoiding the crowded execution layer. Nearly overnight, rollup fees fell by 75 to 90 percent.
Users took notice. They moved. In the next 30 days, Base alone handled over 109 million transactions, while Ethereum’s mainnet handled about 33 million. Two years ago, there was no three-to-one disparity. In a very direct sense, Ethereum’s own living room has been emptied due to the success of its scaling strategy.
Perhaps this is precisely how it was meant to happen. Vitalik Buterin has long advocated for a rollup-centric roadmap that envisions a future in which the majority of activity takes place on Layer-2 chains that occasionally settle to Ethereum’s base layer. In that model, low mainnet fees would indicate that the infrastructure is functioning well enough to eliminate congestion. That argument has a certain elegance. However, the elegance begins to feel uncomfortably close to irrelevance as you watch it unfold in real time, with daily Layer-1 transactions dropping by about 35% from the record set in January 2024.
And there’s the issue of burns. A portion of each gas fee has been permanently destroyed since EIP-1559 was implemented in 2021, which has decreased the amount of ETH in circulation. Ethereum was burning thousands of ETH every day during peak congestion, making the asset deflationary and feeding the “ultrasound money” narrative that some cryptocurrency Twitter users adored. That burn mechanism is hardly operating at the sub-1 gwei base fees of today. Roughly 13,400 ETH were added to the total supply last week—not burned, but created. Not everyone has noticed yet, but the story is subtly changing course.
Validators have undoubtedly taken note. Ethereum staking rewards are based on MEV tips and priority fees, both of which significantly diminish when gas prices are low. Co-founder of Gnosis Martin Köppelmann has noted that after accounting for issuance, validator yields must remain positive by about 23.9 gwei. The network is currently operating at a fraction of that.
The question of how long rational actors will continue to lock up capital in those circumstances is raised by the fact that real yields for stakers have turned negative.
Whether this is a result of a short-term slowdown or something more structural is still unknown. Between early February and mid-2025, global cryptocurrency trading volumes decreased by about 63%. On a few days in late 2024, Solana collected more fees in a 24-hour period than the entire Ethereum network due to the influx of speculative energy from meme coin traders, arbitrage bots, and frantic NFT minters. It’s not a minor detail. That represents a significant change in the concentration of the market’s speculative heat.
Ethereum seems to be in an odd situation where it is technically successful at scaling but suffers economically as a result. Users should be drawn in by lower fees. However, the users are joining Layer-2 chains, where Ethereum charges a comparatively small fee for the privilege.
The base layer itself is quieter, less expensive, and appears to be more of an expensive settlement layer that most people interact with indirectly, if at all, rather than the beating heart of decentralized finance.
There is a glimmer of hope here thanks to history. According to Ryan Lee, chief analyst at Bitget Research, ETH price bottoms and gas fee bottoms have historically been followed by robust recoveries. In 2019 and late 2022, the pattern persisted. Cheap gas today might be a sign of the accumulation phase before users are drawn back by the next surge in activity. It’s also possible that the ecosystem has actually changed and that Ethereum’s mainnet won’t be the site of the next wave.
This moment feels different from previous cycles because of that ambiguity. Ethereum always promised cheap gas, but it seldom delivered. Now that it’s finally, unquestionably here, the gift comes with questions that no one can definitively answer.
When a base layer’s scaling solutions outperform it, what good is it? When deflation ceases, what is the value of a deflationary monetary policy? As this develops, it’s difficult not to wonder if Ethereum’s greatest technical achievement could also be the start of its most challenging identity crisis in a subtle and unsettling way.