30 May 2022

The Ethereum gas price has dropped to July 2021 lows

Plummeting activity on Ethereum during the last couple of weeks has led the gas price to drop to lows not seen since July 2021.
Source: CoinMetrics
Although the activity on Ethereum has been minimal since March, it has declined even further after the Terra collapse. In addition to leading to a market-wide crash, this event seems to have scared crypto users from getting their money involved deep in the DeFi ecosystem.At the time around the Terra collapse, we saw massive spikes in the gas price, most likely caused by market participants withdrawing their money from the DeFi ecosystem. The de-risking is evident by the total value locked in Ethereum DeFi plummeting from 7.1 million ETH at the start of May to 6.3 million ETH now.We have also witnessed a massive decline in the NFT activity, and we especially see plummeting activity in Ethereum gaming.If we exclude July 2021, the previous time gas was priced so low was in May 2020, before activity started taking off on Ethereum, illustrating how docile Ethereum users are at the moment.The low current gas price means that doing heavy computational operations on the Ethereum network is currently very cheap. If you have been waiting for lower transaction fees before minting, buying or selling NFTs or swapping DeFi tokens, now might be the time.
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