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Ethereum fees plummet 70% while self-custody soars

Ethereum fees plummet 70% while self-custody soars

In line with the general sentiment on the wider cryptocurrency market, the price of Ethereum (ETH) has somewhat stalled, but declining network fees indicate there is room for optimism as the lower entry threshold could facilitate more convenience and utility.

As it happens, average Ethereum fees have returned to their normal levels after skyrocketing to the yearly high of $14 per ETH transaction in early May, recently dropping to $4.28 per transaction, according to the data shared by crypto analytics platform Santiment on June 1.

Indeed, these results demonstrate a decline of 69% from only 25 days ago, when the meme coin hype, triggered by the launch and massive success of the Pepe (PEPE) token, had forced Ethereum and Bitcoin (BTC) network fees to soar.

Ethereum average fees and supply on exchanges. Source: Santiment

As the Santiment team further explained, the plummeting transaction fees are a good sign for a broader Ethereum network adoption, accessibility, usage, and engagement, as “more affordability encourages more utility.”

Rise of self-custody

At the same time, the percentage of Ethereum supply on crypto exchanges has dropped to a new all-time low of 9.9% under the influence of the self-custody trend amid security concerns around crypto trading platforms, as well as a lack of regulatory clarity over whether ETH is a security or commodity.

In late March, Finbold reported on the previous record low supply of Ethereum on exchanges, which at the time stood at 10.31%, which meant that nearly 90% of ETH was held away from exchanges but also suggested the high level of confidence from hodlers.

Ethereum price analysis

As things stand, Ethereum is currently changing hands at the price of $1,864.04, recording a decline of 0.21% on the day but a 4.46% gain across the previous week and a 1.69% increase on its monthly chart, according to the latest data retrieved on June 1.

Ethereum 7-day price chart. Source: Finbold

In addition to a record-low supply on exchanges, it is also worth mentioning that Ethereum has recently reached another important milestone as users have deposited more than 4.4 million ETH since April 12, surpassing $40 billion in deposit contract balance following the Shanghai upgrade.

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