Bitcoin (BTC) and Ether (ETH) seem to be experiencing some slowdown as the chain data shows a sharp decline in the dollar value of coins sent via both blockchains in the last week. At the same time, transaction fees for both chains have fallen from recent heights, or in the case of Ethereum, they hit record highs.
Bitinfocharts data shows that on February 25, $ 46.68 billion bitcoins were sent through the Bitcoin blockchain. For some contexts, this represents around 5% of Bitcoin’s total market value, which at the time of writing was $ 925 billion.
Three days later, on February 28, the value of Bitcoins sent in US dollars fell to $ 15.38 billion, or 66%. Meanwhile, average transaction fees for Bitcoin users decreased by 53% – from $ 31.47 to $ 14.63. For context, the highest average fee ever for bitcoin was recorded in December 2017 when bitcoin fees exceeded $ 55, marking the end of the currency’s bullish growth in that period.
On Ethereum, the braking was quite noticeable. In the four days from February 23 to February 27, the total value of coins sent via the Ethereum blockchain decreased 65% from $ 11.1 billion to $ 3.84 billion.
Meanwhile, average Ethereum transaction fees, which rose to a record $ 38.21 by February 23, fell 70% to $ 11.21.
Average commission statistics are often misleading because they are heavily weighted by the large block of transactions involving very high commissions. A typical Ethereum user may be more interested in the average transaction fee, which has also decreased by 72% to $ 5.23. In terms of context, according to GasNow.org, the current recommended “fast” Ethereum transaction fee is around $ 2.80.
This significant decline in activity on both blockchains can be interpreted by some as a sign that the current trend is over. However, a look at the history of both chains shows that such withdrawals are not uncommon.
In January, the value of Bitcoin-dollar transactions fell by 72% over a two-week period, then rose again and increased higher in February. Similarly, the average Bitcoin transaction fee has decreased by 58% during the same time period. Same public image observed on Ethereum.
With that in mind, it is probably too early to assume that the current decline will signal the end of the cryptocurrency rally, at least based on these indicators alone. In fact, in the seven days since these calculations reached their lowest level, they have since begun to rise again as the tide continues in the cryptocurrency market.