How Ethereum recorded huge hike in gas fees amid heightened meme trading
- Ethereum’s gas price reached a 10-month high.
- The ETH price was affected by the gains collected by meme traders.
The reappearance of seemingly profitable memes has helped Ethereum [ETH] record a whooping 73% hike in gas fees. Throughout the week that ended on 22 April, several meme cryptocurrencies caught the attention of the crypto community.
How much are 1,10,100 ETHs worth today?
Indebted to the resurgence
Coincidentally, these highly volatile assets, which were mostly traded on the Arbitrium [ARB] network, engaged in an exchange of ETH. According to IntoTheBlock data, the rise in gas usage made Ethereum $66.7 million within the timeframe.
— IntoTheBlock (@intotheblock) April 22, 2023
It is worth noting that increased activity on the Ethereum network can cause congestion and drive up fees.
Although memes are considered high-risk assets and subject to sudden spikes and drops, there were a bunch of them which exhibited incredible performances in the past week.
Some of these recently emerged memes include PEPE, whose market cap hit 100x within a few days. ArbDogeAI’s [AIDOGE] value increased by over 7,000% last week. And most lately, the focus has been on REKT.
Though most of these assets were currently experiencing a correction, they were instrumental to the rise of ETH circulation. At the time of writing, Santiment revealed that ETH’s circulating supply rose significantly from 12 April.While the momentum cooled off, the hike meant that a lot of ETH was used in transactions in the last seven days. However, there has also been a decline in the average gas used.
Gridlock and reversals
According to Santiment’s data, the average gas used has dropped to 43.99 Gwei. This reflected how traders have restrained from exchanging more ETH for other cryptocurrencies.
Interestingly, Glassnode reported on 23 April that Ethereum’s average gas price reached a 10-month high. In a number of cases, ETH gas fees increase when there is a high demand for cryptocurrency. So, the price increased for the average user in order to avoid clogging.
— glassnode alerts (@glassnodealerts) April 23, 2023
Meanwhile, ETH’s exchange inflow subsided at press time. The metric, which determines how much of the altcoin is flowing into exchanges, was at 18,200.
But over the week, there were several spikes that consented to increased activity since the memes were traded on Decentralized Exchanges (DEXs).
Realistic or not, here’s ETH’s market cap in BTC terms
It was a similar situation with the exchange outflow. As of this writing, the metric was at 5,563. But with a large difference between the outflow and inflow, this condition suggested more of an ETH selling pressure.As expected from cryptocurrencies under the meme bracket, the hype around the aforementioned tokens has dropped. And due to their hit-and-miss nature, investors may be looking to reconsider their risk appetite.