Ethereum transaction fees hit all-time lows as activity surges

Ethereum L1 saw record activity while transaction fees plunged to all-time lows, reshaping the network’s economics. Daily transactions peaked at 1.87 million on Dec. 31, 2025, and Q1 2026 recorded 200.4 million L1 transactions, yet average fees have fallen to about $0.21 (sometimes $0.15). The March 2024 Dencun upgrade (EIP‑4844/proto‑danksharding) enabled cheaper Layer‑2 rollup settlement, shifting volume and most fee revenue off L1. That reduced ETH burned from fees to lows of roughly 53 ETH per day on some days in 2025, undermining earlier deflationary dynamics. For investors, the surge in usage signals stronger adoption and network health, but much of the economic value (fee revenue) now accrues to Layer‑2 networks rather than Ethereum L1, weakening L1’s revenue-driven tokenomics despite higher on‑chain activity.