Meme coins have ballooned to new prices since the beginning of March, boosting blockchain activity in the process. This recent frenzy has seen Ethereum gas fees surging to two-year highs this week.
IntoTheBlock, a leading on-chain analytics provider, announced this new milestone in a recent post on social media platform X. Data from ITB indicates that Ethereum mainnet’s revenue from network fees reached $193 million this week, pushing the annualized rate to the highest point since early 2022.
Ethereum’s $190M+ in weekly fees puts it at an annualized rate of over $10B for the first time since early 2022.
Due to Ethereum’s fee-burn mechanism, this also has an impact on the supply, decreasing it by 33k ETH (~$125M) this week. pic.twitter.com/iAibEvzh4j— IntoTheBlock (@intotheblock) March 8, 2024
Ethereum Gas Fee Surges Due To Meme Coin Activity
Recent market dynamics have seen crypto investors flocking to Ethereum-based meme coins like Shiba Inu, Pepe, and Floki. According to ITB data, PEPE has performed the best in the recent meme coin rally, leading with more than a 600% return in February.
PEPE’s gain has been brought forward into the new month, and the crypto is now up by 800% in a 30-day time frame. Floki is also up by 800% in the same time frame.
Shiba Inu is currently up by 275% in the past 30 days, reaching as high as $0.00004456 on March 5. This surge in the price of Shiba Inu was mostly fueled by a 2,000% surge in new addresses from the February average, peaking at 21,000 new addresses on March 5.
Now, Shiba Inu is less than $4 billion behind Dogecoin in market cap and is on the verge of challenging Dogecoin as the biggest meme coin.
The heightened activity on meme coin has benefited a lot of Ether traders, as they have drawn more traders to decentralized exchanges (DEXs) on Ethereum, where trading volumes have seen a 40% increase over the week to $20.74 billion, according to data from DeFiLlama.
The price of gas fees has also surged in tandem. According to ITB, average gas fees on the blockchain rose to as high as $28 this week. Interestingly, the total money spent on gas fees daily reached $38.02 million on March 5, the highest recorded since May 2023.
Total crypto market cap is currently at $2.5 trillion. Chart: TradingView
Ether To Keep Benefiting From Meme Coin Activity
The total gas fee spent on the Ethereum network is now at an annualized rate of $10 billion. The last time gas fees reached this high was before the crypto market crash in the middle of 2022.
This heightened activity allowed Ethereum to register a new milestone over the $4,000 price level for the first time in two years.
Over the past week, Ethereum’s total supply has shrunk due to Ether’s fee-burning scheme, as 33,000 ETH worth over $125 million were taken out of circulation. Ethereum now has a clear path in following Bitcoin’s footsteps and register a new all-time high in the coming weeks.
Featured image from Pixabay, chart from TradingView