- Staking rates and gas fees on Ethereum begin to fall as the meme coin craze declines.
- On a daily chart, ETH’s selling pressure exceeds its buying pressure.
The hype around meme-based tokens on the Ethereum [ETH] network that drove up the staking rate has begun to subside as the focus shifts towards BRC-20 tokens on the Bitcoin [BTC] network.
According to data from beaconcha.in, Ethereum’s staking rates, which climbed to a post-merge high of 8.6% on 5 May due to increased on-chain gas fees, have begun to experience a decline. At press time, this stood at 6.72%.
Source: beaconcha.in
The meme coin frenzy on the Ethereum network was primarily due to the unexpected launch of meme token Pepe [PEPE] and the astronomical surge in its trading activity and value in the following weeks.
According to a 30 April tweet by on-chain data provider Nansen, the number of PEPE holders exceeded 54,000 in just two weeks. Fuelled by its addition to Binance’s Innovation Zone on 5 May, the market capitalization of the meme coin crossed the $1 billion mark.
54,000+ $PEPE holders in just 2 weeks? 🤯
Impressive, but let’s not forget the 1.3 million $SHIB holders out there!
And did you know that over 3,350 wallets hold both memecoins?
Let’s dive into the top holders of these two 👇 pic.twitter.com/VmJPdJZQEY
— Nansen 🧭 (@nansen_ai) April 30, 2023
However, as profit-taking intensified and trading volume declined, PEPE’s trading volume quickly fell, and its market cap sat below the $1 billion mark at press time. At the time of writing, its value had dropped by over 50% from its all-time high of $0.000004354, which it clinched just five days ago.
Gas fees have also embarked on a downtrend
Due to increased on-chain activity on Ethereum, the median average transaction fee on the network rose to its highest level since May 2022, as PEPE logged huge trading activity.
However, as the token’s trading volume wanes, gas fees on the Ethereum network have also trended downwards.
While still at a one-year high, the daily median gas fee stood at 87 gwei at press time, falling from a high of 143 gwei recorded on 5 May.
Source: Dune Analytics
ETH on a daily chart
At press time, the leading altcoin traded at $1,836.81. Falling from a high of $2008 on 6 May, selling pressure has since surged.
On a daily chart, key momentum indicators rested below their respective neutral spots, indicating that selling pressure outweighed buying pressure. For example, ETH’s Relative Strength Index (RSI) was 44.97. Likewise, its Money Flow Index (MFI) was 48.24.
Also beneath its center line was the Chaikin Money Flow. At -0.05 at the time of writing, ETH experienced a liquidity exit, which might cause its price to dip further.
Source: ETH/USDT on TradingView
