Will Ethereum’s low gas fees help ETH go up the price chart

ambcrypto.com:

Ethereum, the largest altcoin seems to have done the overdue homework regarding its fee structure. Ethereumnetwork fees plummeted in May, below $10 per transaction. Likewise, cheaper fees on layer one (L1) made layer two (L2) fees between $0.02 and $1.13 per transaction.

Santiment’s on-chain metrics on transaction fees show that Ethereum’s transaction fees have been reducing constantly since November 2021. At present, ETH’s average fee costs traders just $2.54 per transaction. As per Santiment, this is the lowest ETH cost level since July.

Source: Santiment

Ethereum’s shift to the Proof of Stake (PoS) consensus, indeed, played a vital part in the said decline. This shift is meant to hugely drop transaction fees by killing off all the parallel chains feeding off the crumbs. 

Last year, the network began implementing the Ethereum Improvement Proposal (EIP) 1559. That created a new system under which transaction fees, once paid to miners would split into a base fee and a tip to the miner. Now the miner gets the tip, but the base fee is burned or destroyed. Ergo, directly affecting the circulating supply.