If you’ve ever sent ETH and thought “Why are the fees so high?” — well, there’s some good news. Ethereum’s transaction fees are now the lowest they’ve been in over 4 years.
This big drop happened as fewer people are using Ethereum directly, and more are switching to cheaper, faster alternatives.
According to a company called IntoTheBlock, the total amount of fees paid on Ethereum went down by almost 60% in the first three months of 2025. That’s around $208 million, the smallest it’s been since 2020.
“Fees are down mostly because Ethereum increased how much data can fit in each block, and more people are using faster versions of Ethereum,” said IntoTheBlock.
So Why Are Fees Falling?
There are two big reasons:
People Are Using “Layer-2” Networks
These are like “shortcut” versions of Ethereum — they run on top of it, but they’re faster and much cheaper to use. One of the most popular right now is Base, which is run by Coinbase.
Right now, Base handles over 80 transactions per second, making it one of the quickest networks out there.
A Major Update Called “Dencun”
In March 2024, Ethereum made a big update that made these Layer-2 networks even cheaper and better. So naturally, more users started using them instead of the slower, more expensive main Ethereum network.
🔥 Good for Users, But Not Great for ETH
While lower fees help people save money, they actually hurt Ethereum itself.
Ethereum normally “burns” (destroys) a bit of ETH every time someone makes a transaction. This helps keep the supply of ETH limited, like Bitcoin.
But because fewer people are using the main Ethereum network now, a lot less ETH is being burned.
Some data shows that ETH burned through popular apps like Uniswap and MetaMask has dropped by over 95% since November 2024. That’s huge.
“ETH is now slowly increasing in supply again, at about 0.75% per year,” said analyst Michael Nadeau. “And things might get worse if nothing changes.”
📉 ETH Price Is Struggling Too
Ethereum’s price hasn’t been doing great lately either. In the first quarter of 2025, ETH dropped by over 45% — its worst performance since 2022.
And if we compare ETH to Bitcoin, it’s even worse: Ethereum has lost 39% of its value compared to Bitcoin this year. That means ETH is falling while BTC is holding stronger.
🐋 But Big Investors Are Still Buying
Despite all this, the big players (called “whales”) are still confident in Ethereum.
When ETH fell below $1,800 recently — the lowest price since late 2024 — whales bought over 130,000 ETH. That shows they still believe ETH will bounce back.
