Ethereum, long criticized for high transaction fees, has seen its gas costs plunge to unprecedented lows. According to Etherscan, the average gas price now stands at 0.045 Gwei, a level rarely seen in recent years. At this rate, nearly all on-chain operations have become incredibly cheap: a test on Uniswap showed a standard ERC-20 token swap costing about $0.01, while simple transfers are even less. Even complex cross-chain or DeFi lending transactions typically stay under $0.12.
Gas Fees Down Over 90% in a Year
The decline is even more dramatic when viewed over a longer timeframe. The past week's average fee was around 0.5-0.6 Gwei, compared to nearly 6 Gwei in the same period of 2025 — a drop of over 90%. This is a far cry from the peak of the bull market, when single transactions could cost more than $200. Current levels are effectively an all-time low in dollar terms.
Layer2 and Protocol Upgrades Reshape the Network
Analysts attribute the fee collapse to major changes in Ethereum's architecture. Layer2 scaling solutions like Arbitrum, Base, and Optimism have matured, absorbing the bulk of everyday transactions. The Dencun upgrade in 2024 introduced EIP-4844 (Proto-Danksharding), which slashed the cost of posting data to L1 for rollups. The subsequent Fusaka upgrade in 2025 increased blob capacity via PeerDAS, further boosting throughput. As a result, Ethereum mainnet block utilization is now around 46%, a stark contrast to the congestion of previous years.
These changes allow high-frequency trading, stablecoin transfers, and DeFi operations to settle on L2s, while the L1 evolves into a secure settlement layer. For developers, low gas fees make it easier and cheaper to test smart contracts, deploy dApps, and mint NFTs.
Market Focus: Demand and ETH Price
Despite the fee downturn, the market remains cautious. ETH is trading around $2,075, significantly below its 2025 highs. However, transaction counts remain high, driven by growing L2 activity, stablecoin settlements, and smart contract calls. This suggests that demand for the Ethereum ecosystem is intact, but activity is shifting from L1 to scaling layers.
Cross-Border Remittance Costs Revisited
A recent study by Mega Financial (Taiwan) highlighted that stablecoin transfers typically incur a fixed fee of 1-2 USDT plus ~0.2% of the transaction amount, concluding that bank wire transfers may be cheaper for amounts over $7,000. But with today's ultra-low gas fees, this conclusion has been challenged. An ERC-20 transfer now costs just $0.01-$0.02, and a DeFi swap averages $0.11-$0.14 — well below the 1 USDT fixed fee. On Layer2, costs can be even lower. Critics argue that Mega's model failed to account for the rapid fee decline on Ethereum, and as scaling continues, the cost structure for crypto payments and cross-border remittances is being fundamentally rewritten.