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Ethereum is facing economic pressure, with transaction fees—the network’s largest source of revenue—falling to their lowest levels in years.
Transaction fees on the Ethereum base layer averaged approximately $0.16 per transaction in April 2025. This is the lowest figure the network has seen since 2020.
Blob fees — the special fees created by Ethereum’s layer-2 solutions — have collapsed. For the week ending March 30, blob fees amounted to just 3.18 ETH, roughly $5,000 at current prices. That’s a staggering 95% decline since mid-March.
Experts say the fees have declined not because of economic conditions but because users are migrating to the Ethereum base layer. Instead, they select cheaper and quicker layer-2 networks like Arbitrum and Optimism.
Layer-2s have made transactions cheap, but they’ve also eviscerated the core revenue of Ethereum. Many fear Ethereum’s base layer is being “cannibalized” by its scaling solutions.
This means fewer users are completing normal transactions, said Brian Quinlivan, a director at Santiment. Instead, they’re using smart contracts or layer-2s that charge less.
Should this continue, Ethereum may have dire financial issues. Investor sentiment is already brittle. Some analysts expect Ether (ETH) prices to collapse to near $1,100 if things go south.