On September 21st, gas fees on the Ethereum network unexpectedly surged, jumping from 10 gwei to over 310 gwei, marking a 30-fold increase. This was the highest level recorded since May 2022 and represented the most significant gas fee fluctuation on Ethereum in 2023.
Subsequently, on-chain detectives swiftly investigated the root cause, and it was eventually revealed that the spike originated from the transaction activity of wallet Binance 14. Specifically, Binance 14 had consolidated funds from inactive addresses and spent 530 ETH (approximately $840,000 USD) on gas fees for this operation. Additionally, the number of transactions from this wallet reached 94,000, significantly higher than usual.
Prior to this spike, gas fees had significantly dropped to their lowest point in eight months, approximately $1.83 USD, with an average gas fee of around 9 gwei. The substantial decrease in gas fees the previous month was influenced by various factors, such as reduced meme coin transactions, decreased usage of Telegram bots, and a decline in NFT trading volume. Furthermore, these metrics also reflected reduced accessibility and utilization of the network.
Currently, gas fees on Ethereum have returned to normal levels. At the time of writing, gas fees are around 11 gwei.
Gas fees on Ethereum are the fees users must pay to process transactions or interact with smart contracts on the Ethereum network. These fees are measured in gwei, with one gwei equivalent to one billionth of an ETH, and can only be paid using ETH.
Fees depend on the network’s demand and processing power supply. This means that when the network experiences a high volume of transactions, the demand for processing power increases, leading to a surge in gas fees.