The average gas fee (transaction fee) on the Ethereum network has cooled off substantially in the first week of June after hitting a multi-month high in May, due to the memecoin frenzy and plenty of max drawable value bot activity ( MEV).
The average gas fee has declined to $7.34, a drop of nearly a third from last month’s high of $20. In terms of gwei, a denomination of Ether (ETH) that represents one billionth of an ETH, the average daily price of gas has declined to 24 gwei from a peak of nearly 140 gwei last month, according to Dune Analytics.
The memecoin frenzy began in late April and took center stage in May, leading to several new memecoins hitting the markets, such as Aped (APED), Bobo Coin (BOBO), and others. Memecoins’ dominance of network activity was so high that it created an unusual turnaround in the top 10 gas-burning altcoins. Instead of ETH, Wrapped Ether (WETH) or Tether (USDT), memecoins like Troll (TROLL), APED and BOBO became the top 10 spenders.
⛽️ A very unusual change in the top 10 gas consumption #altcoins has emerged today. Rather $ETH, $WETHand $USDT being at the top of the fee distribution list, we are seeing new assets like $TROLL, $APEDand $BOBO among them. Read our latest deep dive. https://t.co/7SlmJ59k2m pic.twitter.com/Y2kaLKZTrL
— Santimento (@santimentfeed) April 19, 2023
Another prominent reason for the rise in Ethereum gas fees was the growing popularity of memecoins on decentralized platforms, with major centralized exchanges taking longer to list them.
May wasn’t just about the Ethereum memecoin frenzy; Bitcoin Ordinals also gained significant popularity. Ordinals allow for decentralized storage of digital art on the Bitcoin blockchain. As a result, the Bitcoin network registered many new memecoins, with Pepecoin (PEPE) achieving a market capitalization of one billion dollars.
Related: Bitcoin metrics to the moon: ATH for hash rate, daily and ordinal transactions
Ordinals were introduced in January, and by the end of May, the number of ordinal signups on the Bitcoin blockchain had surpassed 10 million. Total fees paid for Ordinals signups increased 700% in May to currently stand at 1,639 Bitcoin (BTC).
With the memecoin frenzy winding down, Ethereum gas fees have cooled and Ordinals signups have also dropped significantly.
Magazine: Ordinals turned Bitcoin into a worse version of Ethereum: Can we fix it?
