On-chain analytics firm IntoTheBlock observes a weekly decline in Ethereum total transaction fees, which refers to the total amount users pay to send a transaction or execute a smart contract on the Ethereum network.
In a tweet with a graphic attached, IntoTheBlock notes that Ethereum's (ETH) total fees currently stand at $59 million, a 16.5% weekly fall.
"Total Ethereum transaction fees dropped by 16.5% this week. May's meme token mania that fueled the recent fee spike seems to be receding into crypto history," IntoTheBlock noted.
On-chain analytics company Santiment made a similar observation, noting a reduction in Ethereum's average fees. It reports that Ethereum fees have come back down to earth after reaching a 2023 high of $14 per ETH transaction in early May.
Meme token mania recedes
PEPE, the frog-themed meme coin, burst into the spotlight in May. PEPE heralded a new meme coin frenzy as its market capitalization quickly surpassed the $500 million mark within three weeks of launch. A similar frenzy of activity was also seen for some newly launched meme tokens.
Since PEPE is an ERC-20 token that uses the Ethereum blockchain, the impact was felt on the ETH network.
The growth of the PEPE meme coin, which led to significant trading activity, was one of the main drivers behind the sudden increase in Ethereum gas fees to their highest level in more than a year. On May 4, the average cost of a single Ethereum transaction increased above $15.82.
According to Santiment, Ethereum fees have now dropped over 69% from their peak as meme token mania receded. PEPE is currently down 71% from its May 5 all-time high of $0.000004354 and now trades at $0.000001259.