Ethereum Price Crashes 12% Today (7/4/25): ETH Faces Declining Fees and Inflation!

Jakarta, Pintu News – Ethereum transaction fees have dropped to their lowest point in more than four years, marking a major shift in activity on the network.

This decline came amid various challenges faced by the network, including declining market performance and weakening fundamentals.

Then, how will Ethereum price move today?

Ethereum Price Drops 12.11% in 24 Hours

On April 7, 2025, Ethereum (ETH) was trading at approximately $1,548, or around IDR 26,492,934. The price reflected a sharp 12.11% drop over the past 24 hours. Within that timeframe, ETH reached a high of IDR 30,191,044 and dipped to a low of IDR 26,113,286.

At the time of writing, data from CoinMarketCap shows that Ethereum’s market capitalization stands at around $185.73 billion, with daily trading volume rising 312% to $26.25 billion within the last 24 hours.

Read also: 3 Cryptos that Catch Investors’ Attention in Early April 2025!

Ethereum Faces Declining Fees and Inflation Concerns

According to data from IntoTheBlock, Ethereum’s total transaction fees fell by almost 60% in the first quarter of 2025, to around $208 million as of April 4, 2025. The firm notes that this is the lowest level since 2020.

“Total ETH fees fell to their lowest level since 2020 this quarter, which was mainly due to increased gas limits and the move of transactions to the Layer-2 network,” IntoTheBlock said.

Several factors contributed to this decline. The biggest factor is the adoption of Layer-2 networks, especially Coinbase’s Base. An Ethereum update known as Dencun, which launched in March 2024, made transactions on this scale layer much cheaper.

As a result, more and more users are bypassing the Ethereum mainnet and switching to faster and cost-effective alternatives.

Based on data from L2Beat, Base currently processes over 80 transactions per second, making it the leader among all Layer-2 networks.

Despite falling fees, Ethereum experiences pressure on fundamentals and inflation

While lower transaction fees bring benefits, a number of Ethereum’s fundamental indicators are showing signs of stress.

Michael Nadeau, founder of The DeFi Report, highlighted the sharp drop in ETH burn rates.

He noted that the amount of ETH burned through major platforms such as Uniswap , Tether , MetaMask, and 1inch has plummeted by more than 95% since November 2024.

Read also: Can Pi Network Price Rebound? Crypto Expert Gives Advice on Burning Pi Coin!

According to Nadeau, reduced interest from retail investors and a slower-than-expected Layer-2 scalability process are the main causes of Ethereum’s weakening deflationary pressure.

“ETH inflation is currently at an annualized rate of 0.75%. It is likely that this figure will continue to increase, even surpassing Bitcoin inflation. We also expect Ethereum’s fundamentals to continue to weaken over the next year,” he explains.

The network’s financial performance also reflects such concerns. ETH price fell by more than 45% in the first quarter of 2025-making it the worst quarterly performance since 2022.

Compared to Bitcoin , Ethereum is also lagging far behind, losing 39% of its value against BTC so far this year. This decline saw the ETH/BTC ratio fall to its lowest point in almost five years.

Ethereum Whale Accumulates Over 130,000 ETH

However, long-term investors don’t seem to be backing down. IntoTheBlock notes that Ethereum whales have accumulated more than 130,000 ETH as the price fell below $1,800-the lowest level since November 2024-suggesting a strong sentiment to buy on thedip.

On the other hand, industry experts believe that the Pectra update scheduled for release in May could bring some fresh air to the asset.

Read also: XRP Price Prediction: Crypto Analyst Javon Marks Says XRP Could Jump up to 44x!

According to them, Pectra can help restore trust and drive new growth in the Ethereum ecosystem through improved wallet functionality and a better user experience.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities have high risk and volatility, always do your own research and use cold cash before investing. All activities of buying and selling bitcoin and other crypto asset investments are the responsibility of the reader.

Reference:

• BeInCrypto. Ethereum Fees Hit 4-Year Low as Activity Shifts to L2 Networks. Accessed on April 7, 2025