Ethereum News Today: Ethereum Upgrades Finally Deliver on Lower Gas Fees Amid High Demand

Ethereum gas fees have reached a five-year low despite a recent price surge in the cryptocurrency, according to recent data. As of late 2025, the average Ethereum transaction fee stands at approximately $0.44, a marked decrease from previous years, even as the price of ETH continues to climb [1]. This trend is attributed to Ethereum’s ongoing upgrades, including the Fusaka upgrade expected in November 2025, which aims to enhance gas limits and overall network efficiency by up to 70% from 2024 levels [2]. The London Hard Fork of 2021 introduced a dynamic base fee and optional priority tip model, a system that continues to refine the predictability of gas pricing and reduce volatility [3].

Despite the lower fees, Ethereum remains more expensive than other blockchain networks such as Solana and BNB Chain. For example, Solana’s average transaction cost is around $0.00025, while BNB Chain averages between $0.05 and $0.20 [2]. The disparity is largely due to Ethereum’s complex smart contract capabilities, higher network demand, and the resource-intensive nature of DeFi and NFT transactions. As of August 2025, Ethereum’s average TPS (transactions per second) stands at approximately 30, compared to Solana’s 3,700 TPS, making it one of the most scalable networks [2].

The decrease in Ethereum gas fees has also been supported by the growing adoption of layer-2 (L2) solutions such as Arbitrum, Optimism, and zkSync. These platforms process transactions off-chain and batch them for on-chain settlement, significantly reducing costs. Arbitrum, for instance, sees average fees around $0.0088, while zkSync brings the cost down to approximately $0.0126 for similar transactions [3]. These L2 solutions are increasingly being adopted for DeFi and NFT activities, where the cost of processing transactions on the Ethereum mainnet can be prohibitively high [1].

Gas fees are calculated using a combination of gas units and gas price, where the total cost equals the gas limit multiplied by the base fee plus any optional priority tip. For example, a simple ETH transfer of 5 ETH with a gas limit of 21,000 units, a base fee of 0.75 gwei, and a priority tip of 0.015 gwei would cost around $0.064 [4]. The introduction of EIP-1559 in 2021 added a dynamic base fee that adjusts based on network demand, further stabilizing pricing [3].

Despite these improvements, Ethereum’s gas fees remain demand-driven. During peak hours, especially in overlapping market times for the US and Europe, fees can spike due to high transaction volumes. Conversely, fees tend to drop on weekends and during off-peak hours. For instance, Ethereum’s fees in 2024 averaged $2.48B annually, with most of the base fees burned to reduce supply inflation [2]. This model contrasts with Solana, where 50% of fees are burned and the other half goes to validators [3].

Looking forward, Ethereum’s long-term scaling plans, including sharding and advanced rollups, are expected to further reduce gas fees and increase throughput. The network’s shift to a proof-of-stake consensus model with The Merge in 2022 already reduced energy consumption by over 99.95% [2]. With these ongoing improvements, Ethereum is positioned to compete more effectively with low-fee blockchains while maintaining its dominance in smart contract-based applications.

Source:

[1] title1 (https://nftevening.com/what-are-gas-fees-in-crypto/)

[2] title2 (https://medium.com/@ankitacode11/unraveling-gas-fees-a-comprehensive-guide-to-transaction-costs-across-blockchains-72509f649811)

[3] title3 (https://www.cryptopolitan.com/gas-fees-explained/)

[4] title4 (https://www.britannica.com/money/ethereum-gas-fees-eth)