Ethereum daily transaction fees surpass Bitcoin's

On June 6th Ethereum daily transaction fees surpassed those of Bitcoin and have remained above since. While Ethereum fees have previously surpassed Bitcoin fees multiple times in the past, most instances were just momentary spikes. The last time Ethereum fees were above Bitcoin fees on a sustained basis was mid-2018, during the tail end of the ICO craze.

Bitcoin fees momentarily spiked following its May halving. Hashrate declined substantially following the 50% decrease in Bitcoin’s block subsidy, which led to block times rising. With transactions taking longer to confirm, Bitcoin’s mempool became backed up, putting pressure on fees. After Bitcoin’s June 4th difficulty adjustment, one of its largest ever, block times have begun to normalize and transactions fees have fallen.

Ethereum fees rose over the past couple months as Ethereum blockspace usage increases. As covered previously, a significant reason for this is Ethereum’s increasing daily settlement value, which has exploded over the past year as stablecoins come to prominence.

Why it matters:

• Although Ethereum fees have “flipped” Bitcoin’s in the past, the most recent one is interesting because it's both more sustained and more utility driven.
• Ethereum scaling solutions will be critical in how this trend develops. Last week Tether announced its launch on OMG Network, a layer 2 scaling solution. USDT's move to OMG Network could relieve pressure on the Ethereum blockchain and reduce fees.

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