Ethereum (ETH) Low Gas Despite High Throughput Could Indicate Capital Rotation From Bitcoin

• ETH throughput >2M daily tx and ~700k active addresses with fees still near multi‑year lows

• Capital appears rotating from Bitcoin to Ethereum, pushing the ETH/BTC ratio above 0.04.

• Median gas hit sub‑1 gwei this week (0.396 gwei and 0.432 gwei on August 16–17), while Ethereum TVL approaches $100B.

Ethereum gas fees stay low as ETH nears highs — read how protocol upgrades and L2s enable scaling, what metrics matter, and why this matters for ETH price action.

What is causing Ethereum gas fees to stay low despite rising demand?

Ethereum gas fees are low because recent protocol upgrades and increasing Layer‑2 settlement have materially increased effective capacity, so on‑chain demand (transactions and active addresses) no longer maps one‑for‑one to fee spikes. EIP‑1559, L2 batching, and horizontal scaling reduce per‑transaction settlement costs while preserving security.

How are on‑chain metrics changing and what do they mean for ETH price?

Daily transactions have surged past 2 million and active addresses hover near 700k, yet median gas remains compressed. This decoupling means the network can absorb more economic activity without the fee blowouts that previously capped rallies. As a result, ETH can test price discovery levels with less friction from transaction costs.

Frequently Asked Questions

Why did median gas drop to 0.396 gwei and 0.432 gwei on August 16–17?

Protocol-level fee mechanisms and L2 settlement flows reduced on‑chain competition for block space during those days, pushing median gas below 1 gwei. This reflects increased batching and settlement efficiency across aggregators and rollups. Source: Dune (data reference, plain text).

Is the ETH/BTC ratio breakout a reliable signal for rotation into Ethereum?

Yes — the ETH/BTC ratio breaking above 0.04 indicates relative strength in ETH versus BTC, often signaling capital rotation. However, traders should combine ratio signals with on‑chain and macro indicators for confirmation. Source: Token Terminal (data reference, plain text).

Can ETH continue to reach new all‑time highs without fee spikes?

Potentially. If scaling improvements and Layer‑2 adoption continue, the network can sustain high throughput while keeping fees low, lowering one historical constraint on ETH price rallies.

Key Takeaways

• Throughput vs Fees: Ethereum shows record L1 throughput (>2M tx/day) while median gas stays near five‑year lows.
• Structural change: EIP‑1559 + Layer‑2s are enabling horizontal scaling without immediate fee blowouts.
• Market impact: Low fees reduce a historical constraint on ETH rallies, supporting sustained DeFi and NFT activity as TVL approaches $100B.

ETH’s record L1 throughput meets suppressed gas costs

There’s a striking paradox in Ethereum’s current setup: on‑chain load has surged, yet the fee market remains calm. Daily transactions are above 2 million and active addresses near 700k, levels that previously triggered fee stress. This cycle, however, fees have not mirrored that demand.

Source: Token Terminal

Historically, spikes in on‑chain load led to fee market stress. This cycle, that correlation has broken: upgrades and L2s absorb demand, keeping gas anchored near cycle lows.

Has Ethereum’s network finally caught up with demand?

Yes — evidence points to a structural evolution. Over the past five years, gas spikes were common during NFT and DeFi booms. Since 2022, spikes are rarer and smaller. This week’s median gas values were sub‑1 gwei, including 0.396 and 0.432 gwei on August 16–17.

Source: Dune

With median gas subdued and TVL pushing close to $100 billion, Ethereum appears to have more headroom for user growth without the old fee‑driven choke points.

Conclusion

Ethereum’s current state—record throughput with suppressed gas fees—marks a meaningful shift in network dynamics. Protocol upgrades and Layer‑2 adoption are reducing fee friction, which supports further ETH price discovery and sustained on‑chain growth. Watch transaction throughput, median gas, TVL, and the ETH/BTC ratio for the next confirmation of structural rotation.