- Ethereum’s network transaction fees, known as gas fees, experienced a significant drop in the first week of June, following the memecoin frenzy in May.
- Alongside Ethereum, Bitcoin also saw a sharp decline in its memecoin-related activities, specifically through Ordinals, which had been popular during May.
The Ethereum blockchain has seen a substantial reduction in the average gas fee — the cost of conducting transactions — during the initial week of June. This relief comes after reaching a multi-month peak in May, driven by a memecoin frenzy and an influx of maximal extractable value (MEV) bot activities.
The average transaction fee on the Ethereum network has seen a roughly one-third decrease, falling to $7.34 from a May high of $20. Analyzing this in the Ethereum denomination, gwei — which equates to one-billionth of one ETH — the median daily gas price has descended to 24 gwei from almost 140 gwei last month, as reported by Dune Analytics.
The memecoin wave gained momentum towards the end of April, culminating in May, and led to the launch of several new memecoins including Aped (APED), Bobo Coin (BOBO), and more. The prominence of memecoins in network activities was so significant that it caused an unusual shift in the ranking of the top gas-consuming altcoins. Instead of regular frontrunners like ETH, Wrapped Ether (WETH), or Tether (USDT), memecoins such as Troll (TROLL), APED, and BOBO secured spots among the top ten gas spenders.
A key factor contributing to the spike in Ethereum gas fees was the escalating popularity of memecoins on decentralized platforms. Mainstream centralized exchanges were slower to list these tokens, further accentuating this effect.
May was not exclusively about Ethereum’s memecoin craze; Bitcoin Ordinals also came into prominence. Ordinals facilitate decentralized storage of digital art on the Bitcoin blockchain. Consequently, the Bitcoin network registered an influx of new memecoins, with Pepecoin (PEPE) hitting a market capitalization of one billion dollars.
Introduced in January, Ordinals inscriptions on the Bitcoin blockchain exceeded 10 million by the end of May. The total fees paid for these Ordinals inscriptions skyrocketed by 700% in May, totaling 1,639 Bitcoin.
However, with the memecoin frenzy simmering down, Ethereum gas fees have receded, and Ordinals inscriptions have seen a noticeable drop.
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