- An increase in inter-chain transfer could temporarily increase ETH transaction fees.
- Volatility increased, meaning ETH’s value could decrease further.
Over the last few weeks, a significant amount of Ethereum [ETH] has been moved from the Mainnet into other chains. The movements within the Ethereum network have been closely linked to the attention given to a number of Layer Two (L2) projects.
How much are 1,10,100 ETHs worth today?
This, in turn, has reduced activity on the Ethereum Mainnet as previously reported. Furthermore, the recent trend has raised questions about the potential impact on the network.
For CryptoQuant’s author and community manager Woominkyu, the decrease in network activity does not mean that Ethereum fees will be reduced.
In his analysis, he opined that the movement of the altcoin into other chains could temporarily increase transaction fees. By looking at the ETH inter-chain transfer, the chart shared by Woominkyu showed that the metric had significantly increased.
However, the analyst did not highlight the effect on fees alone. He also explained how the movement could affect ETH’s short-term volatility. His publication read,
Author: Victor Olanrewaju
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