The price of Ether (ETH) has broken past the $4,000 price level following months of lackluster price performance — reclaiming levels not seen since March 2024.
The release of the Dencun upgrade in March 2024 dramatically lowered fees for Ethereum layer-2 scaling networks, causing Ethereum layer-1 revenues to collapse by 99%.
Decreased fees translated into reduced demand for the smart contract cryptocurrency. However, network fees began to rebound in September 2024.
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According to data from Token Terminal, the Ethereum base layer generated approximately $10.9 million in fees on Dec. 5. For comparison, Ethereum was generating fees in the $500,000 range during the height of the fee suppression in August 2024.
Ethereum price action. Source: TradingView
Analysts believe that the price of Ethereum could reach $7,000 during the current market cycle, bolstered by inflows from exchange-traded funds and other investment vehicles, and a robust ecosystem of developers building on the Ethereum blockchain.
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