Low Ethereum Fees Aid Traders but Could Indicate Deeper Revenue Concerns

• Gas fees on Ethereum layer-1 hit 0.067 Gwei on Sunday, the lowest in recent months.

• Average swap costs now stand at $0.11, making onchain activities more accessible during market lulls.

• Transaction volumes remain steady, but fees have stayed below 1 Gwei for most of October and November, per Etherscan data, signaling potential shifts in user behavior.

Ethereum gas fees drop to historic lows in 2025, benefiting traders with costs under $0.20 per transaction. Discover implications for network revenue and security. Stay informed on crypto trends—read now for expert insights.

Why Have Ethereum Gas Fees Dropped So Low?

Ethereum gas fees have fallen sharply to 0.067 Gwei on the layer-1 blockchain, driven by reduced network activity after October’s market crash that saw some altcoins lose over 90% of their value in a day. This drop, from a peak of 15.9 Gwei on October 10, has persisted below 1 Gwei through much of October and November. According to Etherscan, current costs include $0.11 for swaps, $0.19 for NFT sales, $0.04 for bridging assets, and $0.09 for onchain borrowing, providing immediate relief for users.

Gas fees on the Ethereum layer-1 blockchain dropped to just 0.067 Gwei on Sunday, amid a lull in the crypto markets sparked by October’s historic market crash.

The average price for executing a swap on Ethereum is just $0.11, non-fungible token (NFT) sales carry a fee of $0.19, bridging a digital asset to another blockchain network will cost users $0.04, and onchain borrowing costs $0.09 at the time of this writing, according to Etherscan.

Ethereum network transaction fees hit a recent high of 15.9 Gwei on October 10, the day of the market flash crash that caused some altcoins to shed over 90% of their value within 24 hours.

However, by October 12, fees dropped back down to just 0.5 Gwei and mostly remained well below 1 throughout October and November. 

Ethereum layer-1 gas prices over the last month. Source: Etherscan

Investors and traders may take advantage of the low transaction fees to execute onchain transactions on the base layer. However, analysts and crypto industry executives warn that the excessively low fees might spell trouble for the Ethereum ecosystem.

How Do Low Ethereum Gas Fees Impact Network Revenue?

Low Ethereum gas fees reflect a broader decline in layer-1 revenue, which has contracted by 99% since the Dencun upgrade in March 2024, as reported by Token Terminal. During the 2021 bull run, fees often exceeded $150 amid congestion, but post-upgrade optimizations for layer-2 solutions have shifted activity away from the base layer, reducing overall income. This revenue drop poses financial challenges, as it limits funds available to reward validators who secure the network through proof-of-stake mechanisms.

During the 2021 bull run, transaction fees on the Ethereum layer-1 could cost users $150 or more during times 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%.

Ethereum layer-1 network fees 2023-2025. Source: Token Terminal

Critics say the 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 chosen a scaling strategy that relies on an ecosystem of separate layer-2 networks, which represents a double-edged sword, according to research from crypto 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 own ecosystem.

Experts in the field, including blockchain analysts from firms like ConsenSys, emphasize that sustained low fees could undermine the economic model that keeps Ethereum secure. “The base layer’s revenue is the backbone of Ethereum’s decentralization,” noted one industry executive in a recent panel discussion. Data from Etherscan shows daily transactions topping 1.6 million even as fees hover near pennies, indicating robust usage but inefficient monetization on the main chain.

This shift highlights Ethereum’s strategic focus on scalability through layer-2 protocols like Optimism and Arbitrum, which handle high-volume activities at fractions of the cost. However, as these solutions proliferate, the layer-1 sees diminished direct engagement, potentially affecting long-term validator participation. Token Terminal’s metrics illustrate a steady downward trend in base-layer earnings from highs in 2023, underscoring the need for balanced growth strategies.

Frequently Asked Questions

What Causes Ethereum Gas Fees to Fluctuate?

Ethereum gas fees fluctuate based on network demand, with peaks during high activity like market surges and lows during quiet periods such as post-crash lulls. The Dencun upgrade in 2024 further stabilized fees by enhancing layer-2 efficiency, but base-layer costs remain tied to transaction volume and complexity, as tracked by Etherscan.

Are Low Ethereum Gas Fees a Sign of Network Health?

Low Ethereum gas fees indicate reduced congestion and affordability for users, but they may signal underlying issues like revenue loss from layer-2 migration. While beneficial short-term, experts warn of security risks if fees stay too low to incentivize validators adequately, according to analyses from Token Terminal.

Key Takeaways

• Record Low Fees: Ethereum gas fees at 0.067 Gwei offer traders costs as low as $0.04 for bridging, per Etherscan.
• Revenue Challenges: Layer-1 income has fallen 99% since 2024’s Dencun upgrade, impacting validator incentives amid layer-2 growth.
• Scaling Trade-offs: Ethereum’s layer-2 ecosystem boosts scalability but competes with the base layer, requiring careful economic balancing for sustainability.

Conclusion

The plunge in Ethereum gas fees to historic lows underscores both opportunities for cost-effective trading and risks to the network’s revenue model, exacerbated by the success of layer-2 solutions post-Dencun. As the ecosystem evolves, maintaining a healthy balance between scalability and base-layer viability will be crucial. Traders should monitor these trends closely, leveraging low fees now while preparing for potential shifts in Ethereum’s economic dynamics.