As Ethereum fees hit a seven-month low, BTC rises with a broader market

The price of Ethereum (ETH) soared today along with several other crypto assets after what appears to have been a month of poor performance against the price of Bitcoin (BTC), in addition to prolonged periods of plummeting interest in non-fungible tokens (NFTs) and decentralized finance (DeFi).

ETH was trading at USD 2,750 on Wednesday 12:55 UTC, up to 6.9% in the last 24 hours. It has been down 7.6% for the past 7 days.

Even though ETH holders well-received today’s rally, the coin was far from the greatest performer in the market, with BTC up 8.7% and top performer terra (LUNA) up more than 21% in the same 24 hours.

Price of Ethereum in the last 30 days

Source: CoinGecko

ETH’s latest gains are realized following what has been extended periods of underperformance compared to Bitcoin, with the ETH/BTC trading pair currently down by about 26% from highs of BTC 0.088 per ETH in December 2021. When reporting this, ETH 1 traded for 0.065 BTC on the crypto exchange firm, Binance.

The rise in the price of Ethereum coincides with the lowest charge for those who send transactions through the Ethereum network since August 2021. Of importance to note is that the average transaction fee on Ethereum was USD 10.28 as of Tuesday this week.

According to BitInfoCharts, this compares to a high of USD 52.46 set in January and an all-time high of USD 69.92 set in May 2021.

Commenting regarding the fall in transaction charges, CryptoCompare, a crypto tracking site, noted its February monthly report that the charges continue to remain “well above fees in other networks.” The firm pointed out to Cardano (ADA), XRP, and BTC, which had average fees of USD 0.48, 0.11, and 1.84, respectively.

ETH transaction fees (7-day moving average):

Source: BitInfoCharts

While one reason for the decrease in transaction costs is that ETH has gotten cheaper in US dollar terms, another one is that NFT trading on Ethereum has also decreased.

Daily trading volume on the major NFT marketplace OpenSea is down dramatically from its peak on February 1 this year, when USD 360 million worth of NFTs were traded. This is according to statistics sought from Dune Analytics. After decreasing steadily since the February high, that sum was barely USD 46 million as of Tuesday this week.

Source: Dune Analytics

OpenSea daily volume in USD:

The fall in the activity of NFT comes following lower interest in another sector that’s key for Ethereum: decentralized finance.

According to DeFi Pulse statistics, the total value locked (TVL) in Ethereum-based DeFi protocols had decreased dramatically since the end of last year, when TVL reached an all-time high of USD 110.72 billion. That sum has significantly dropped to USD 76.18 billion as of today.

Notably, the drop is also seen when measured in Ethereum terms. The TVL has also dropped from an all-time high of ETH 11million on April 20 last year to ETH 8.18million, according to the data published by DeFi Pulse.

Clients to be referred to an ETH fund by Goldman Sachs

With all these was taking place, it emerged yesterday that Goldman Sachs, an investment banking firm, will give customers interested in Ethereum exposure the go-ahead to invest in Galaxy Institutional Ethereum Fund.

Based on the fund’s fact page, the fund, managed by Mike Novogratz’s firm Galaxy Digital, invests directly in ETH and is only open to authorized investors. Goldman Sachs would receive an “introduction fee” for all clients it introduces to Galaxy’s fund, according to a filing with the US Securities and Exchange Commission (SEC). However, how much money has already been directed to the fund via Goldman Sachs is unknown.