Transaction fees on the Ethereum blockchain have experienced a significant surge over the past 24 hours, coinciding with the price of ETH hitting a two-year high above $3,700.
This development comes as the U.S. Securities and Exchange Commission (SEC) is delaying rulings on several pending cash ETH exchange-traded fund (ETF) applications.
Ethereum price surge coincides with high network fees
Over the past day, the price of ETH has risen about 7% at press time, reaching around $3720, its highest level since early 2022.
This surge brings ETH’s overall gain over the past month to over 60%. That’s because the blockchain network reflects a broader cryptocurrency market resurgence that has pushed the price of Bitcoin above $67,000.
However, Ethereum network gas prices surged amid this upward price trajectory, reaching an average high of 79 gwei and a peak cost of 219 gwei, according to Etherscan data. Several Ethereum users took to social media to criticize the high fees and how it affected trading activities, including token swaps and leveraged transactions.
Surprisingly, this spike in fees pushed total network fees to over $33 million in one day, a three-fold increase since the beginning of the year, according to data from Cryptofees.
Meanwhile, market observers have pointed out that the impending Dencun upgrade could solve this problem of high fees. The upgrade is expected to address Ethereum’s historical issues, including slow transaction speeds, limited throughput, and high fees.
SEC delays delay Ethereum ETF decision.
Despite Ethereum’s impressive surge, the SEC has further delayed its decision on the application of the BlackRock and Fidelity Ethereum ETFs.
The regulator is seeking public input on the potential fraud and manipulation risks associated with the spot ETH ETF and has also raised questions about Ethereum’s proof-of-stake consensus mechanism.
Meanwhile, the SEC’s decision comes as no surprise as market participants remain divided on whether the regulator will approve an Ethereum ETF. Industry insiders say the SEC remains cautious about cryptocurrencies despite its recent approval of a spot Bitcoin ETF.
Nonetheless, major cryptocurrency stakeholders such as Coinbase have advocated for the approval of an ETH ETF.