Ethereum is going through a challenging period, experiencing a 55% price drop and a decline in transaction fees to a four-year low. Network activity and selling pressure become important factors for Ethereum's future.
Ethereum Transaction Fees Hit 4-Year Low
According to recent data, Ethereum transaction fees have dropped to their lowest level seen nearly four years ago. This has caught the crypto community's attention, as lower fees make transactions more affordable for users. Among the reasons for this drop are reduced network activity and increased sell pressure from long-term holders.
Ethereum Price Outlook
Ethereum has faced difficulties maintaining above the $2,050 mark, dropping below $1,850, indicating weakness. Currently, the price consolidates, facing resistance around $1,850. A key technical indicator, the RSI, at 37, suggests bearish momentum is fading, while the Stochastic Oscillator hints at a possible pullback.
Impact of Other Factors on Ethereum
Ethereum's layer-2 solutions like Arbitrum, Base, and Optimism are gaining popularity due to lower fees and increased speed. This reduces demand for Ethereum's main network, further lowering transaction costs. If this demand drop continues, Ethereum's long-term market positions may change.
The situation on the Ethereum market remains tense. The decline in transaction fees and price contributes to investor uncertainty. Ethereum needs to break above the $2,000 mark to regain confidence.
