- BlackRock’s iShares Ethereum Trust bought $10.7 million in ETH on Thursday.
- Ethereum’s gas fee plunged below 1 gwei (around $0.06) on Friday.
- JPMorgan claims that ETH has underperformed because of “intense” competitors.
Leading digital asset management firm BlackRock’s spot Ethereum exchange-traded fund (ETF), ETHA, added ETH worth a substantial $10 million on Thursday. Meanwhile, the price of the digital asset failed to break the $3,000 price level in the past few days, despite the broader market recovering from sell offs originating from fears of recent tariff impositions.
On February 6th, ETHA added 3,840 ETH worth around $10.7 million and as per SoSoValue data, the iShares Ethereum Trust was the only spot ETH ETF with any inflow.
No transaction was recorded for other Ethereum ETFs, including Grayscale’s ETHE on Thursday. The cumulative net inflow into US spot ETH ETFs stands at a significant $3.18 billion which also includes $3.93 billion worth of outflows from ETHE.
Related: Vitalik Buterin Warns of DAO Vulnerabilities, Questions ‘Renting’ Votes
Ethereum Gas Fees Plummet
On the other hand, the Ethereum gas fees (the cost of making a transaction on the network) saw levels below 1 gwei, around $0.06, Etherscan data showed.
Crypto market participants discussed the potential reasons for this decline in the gas fees, with some claiming that the blockchain is not used by developers anymore. An X (formerly Twitter) user called Ethereum a ghost chain with others calling the ETH token a “dead coin.”
Why Are Gas Fees So Low?
A major reason for the drop in Ethereum gas fees could be increased usage of Layer 2 networks including Arbitrum (ARB), Optimism (OP), and Polygon (POL) alongside scalable Layer 1 protocols like Solana (SOL), BNB Chain (BNB), Tron (TRX), Avalanche (AVAX), and Cardano (ADA).
Additionally, as per a report, JPMorgan said that ETH has underperformed this cycle because of this “intense” competition with other blockchains and lack of a narrative like its peer Bitcoin (BTC) has. While Ethereum has already implemented the Dencun upgrade and the developers will begin testing Pectra in February, JPMorgan said that most of the activity has moved into Layer 2 networks.
Related: Can Ethereum’s February Consistency Kickstart Altcoin Gains?’
Uniswap, one of the “largest gas consuming protocols” on the Ethereum network, is also migrating to Unichain. This could deal a severe blow to Ethereum as the cryptocurrency has already crashed 16% in the past week and trades at $2,738.57 at press time.
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Source: https://coinedition.com/blackrock-buys-more-eth-as-ethereum-gas-fees-hit-record-lows/