The ethereum network is witnessing a drastic reduction in the amount of gas used, as total gas usage recently plummeted to 4,507,912,628, a low last seen in October 2022.
This gradual reduction in gas usage comes amid the market-wide correction that has knocked ethereum (ETH) below $1,600.
The previous 4-month low was seen on February 8, according to data from a Glassnode chart shared today. The blockchain data provider revealed that since reaching a peak a few weeks after the Merger last year, the use of ethereum gas has continued to decline, hitting persistently lower lows of late.
Although gas usage has not dipped below the 4.5 billion mark since October, if the current rate of decline persists, the grid could see a break below this level. Historically, a decrease in gas usage suggests that there is currently less demand for computing resources on the grid. This could indicate a decline in transaction volume or a change in user behavior away from gas-intensive activities such as decentralized finance (DeFi) trading.
Ethereum faces bearish opposition
This steady decline comes on the heels of the latest market-wide opposition recently engineered by the bears, to which Ethereum has not been immune. The asset has fallen by 7.79% in the last week after registering two consecutive losses in the last 2 days.
Ethereum’s biggest intraday loss for this year occurred on February 9, after gas usage hit a 4-month low the day before. The asset lost as much as 6.37% of its value that day, breaking below the $1,600 mark. ETH has continued to trade below price territory, with the bears looking to hit the asset further below the $1,500 level. The asset is currently changing hands at $1,503.
Amid these inauspicious price moves, investors have been steadily sending their ETH tokens onto exchanges, behavior that often indicates a sell-off. The CryptoQuant exchange network flow metric reveals that ETH net deposits are higher than the 7-day average.
Furthermore, the Whale Alert blockchain monitoring system recently highlighted that a large ETH whale address, with a balance of 100 ETH, just went live after seven and a half years of lying dormant.
