Ethereum Gas Fees Plummet Amidst Revenue Sustainability Concerns

Sunday Nov 9 2025 22:10

Duration

2 min

  1. 1. Ethereum Gas Fees Plunge: An Overview

  2. 1.1 Historical Context of Gas Fees

  3. 1.2 The Impact of the Dencun Upgrade

  4. 1.3 Sustainability and Security Concerns

  5. 1.4 Conclusion

Ethereum Gas Fees Plunge: An Overview

The Ethereum network has witnessed a notable decrease in gas fees, hitting a low of 0.067 Gwei on Sunday, amidst a lull in the cryptocurrency markets. This decline makes the average cost to execute a swap on Ethereum around just $0.11, while non-fungible token (NFT) sales carry a fee of $0.19. Bridging a digital asset to another blockchain network costs $0.04, and on-chain borrowing carries a cost of $0.09.

Historical Context of Gas Fees

Ethereum network transaction fees reached a recent high of 15.9 Gwei on October 10, the day the market experienced a flash crash that resulted in some altcoins shedding over 90% of their value within 24 hours. However, by October 12, fees dropped back down to 0.5 Gwei and largely remained below 1 throughout October and November.

The Impact of the Dencun Upgrade

While investors and traders may benefit from the low transaction fees to execute on-chain transactions on the base layer, analysts and cryptocurrency industry executives warn that excessively low fees could spell trouble for the Ethereum ecosystem. The Ethereum base layer has seen a loss of revenue since 2024. During the 2021 bull run, transaction fees on the Ethereum layer-1 could cost users $150 or more during periods of network congestion. However, following the Ethereum Dencun upgrade in March 2024, which lowered transaction fees for Ethereum’s layer-2 scaling networks, fees contracted significantly, causing Ethereum’s revenue to decline by 99%.

Sustainability and Security Concerns

Critics argue that low network fees are unsustainable for any blockchain network and present both financial and security challenges due to the lack of revenue to incentivize validators or miners to process transactions and secure the blockchain. Because fees are responsive to user demand, low fees and revenues could also signal that users are moving away from a particular blockchain network. Ethereum, in particular, has adopted a scaling strategy that relies on an ecosystem of separate layer-2 networks, which represents a double-edged sword, according to research from cryptocurrency exchange Binance. While layer-2 networks allow Ethereum to scale and compete with newer, high-throughput chains, the Layer-2 networks are also cannibalizing revenue from the base layer, creating additional competition for Ethereum within its ecosystem.

Conclusion

The decline in Ethereum gas fees presents an opportunity for users but also raises questions about the financial and security sustainability of the network. Investors and developers should monitor network developments and assess their impact on the Ethereum ecosystem.

Risk Warning: This article is provided for informational purposes only and does not constitute investment advice, investment research, or a recommendation to trade. The views expressed are those of the author and do not necessarily reflect the position of Markets.com. When considering shares, indices, forex (foreign exchange), and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and may not be suitable for all investors. Leveraged products can result in capital loss. Past performance is not indicative of future results. Before trading, ensure you fully understand the risks involved and consider your investment objectives and level of experience. Cryptocurrency CFD trading restrictions may apply depending on jurisdiction.

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Written by:

Noah Lee

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