ETH price up to $ 1.2k? Ethereum’s Pos ‘Deflation’ ends with fees all the time lows

Ether (Eth) The price is printed by a bear flag in the sun -sun chart, a technical chart formation associated with strong downward momentum. Can the setup and deduction of transaction fees be signed at the start of the second leg of ETH falling to $ 1,200?

Ethereum network activity has fallen

The drawdown of the market, already -fueled by US President Donald Trump’s Tariff ThreatsEther’s price dropped by almost 50% from a high $ 3,432 on January 31 to a 16-month low $ 1,750 on March 11.

While ETH has changed 18% since, it failed to take a decisive rest above $ 2,000 for the second time in less than 10 days.

This weakness is reflected in the onchain activity, along with the sun -day number of Ethereum transactions decreasing the levels last seen in October 2024, before The success in Donald Trump’s presidency election.

The average Ethereum transaction fees also collapsed, reaching a full time low than 0.00025 ETH ($ 0.46) on March 24.

Low transactions and fees suggest less demand for the block space – for defi, NFT or other DAPPs. It suggests lower network activity, often linked to decreased interest or confidence in the market.

Historically, the price of Ether has been linked to periods of high network activity. For example, during the 2021 Defi Boom, the fees reached as high as 0.015 ETH due to high demand.

By contrast, the lower fees require less ETH, which puts down pressure on the price.

ETH supply inflation returns

Other major factors weighing Ether’s performance are the denial of combustion rate and supply increase.

With the refusal of transaction fees, the daily ETH combustion rate has fallen all the time lows, resulting in an inflationary.

According to data from Ultrasound.Money, the expected ETH combustion rate declined to 25,000 ETH/year, and its supply growth increased at an annual rate of 0.76%, carrying a release rate to 945,000 ETH each year.

As a result, the supply of Ethereum has continued to increase since April 2024, reversing the deflection period brought by The proof-of-stake switch (the merge) in September 2022. The total Ethereum supply now exceeds the pre-merge levels, as shown in the chart below.

The combination removed the release of Ethereum mining, which had previously had a high rate of supply inflation. Ethereum also implemented London Hard Fork In August 2021, which introduced a mechanism that burned a portion of transaction fees.

Related: Ethereum down 57% from all times high, but it’s still worth it than Toyota

When the network activity is low, the amount of ETH burned is lower than the newly issued ETH, which makes the asset inflationary.

Ether’s bear targets the $ 1,230

The ETH/USD pair has been positioned to continue the existing Bearish momentum despite recovery from recent lows, as the chart shows a classic bearish pattern in labor.

Ether price action over the past 30 days has led to the formation of a Bear flag Pattern on the sun -day chart, as shown in the figure below. A day -to -day candle near the bottom of the lower flag border at $ 2,000 will signal the start of a massive breakdown.

The target is set by the height of the flagpole, reaching about $ 1,230, an approximately 40% fall from the current price.

Despite these risks, some merchants remain optimistic about Ether’s reversed potential, with analyst Jelle saying That the price has been bouncing and trying to get back to the above key level level at $ 2,200.

If this happened, “we would have a deviation from the monster in our hands,” Jelle added.

Fellow analyst Crypto Ceaser said Ethereum is “heavily undervalued” and decreases at current levels.

$ Eth – #Ethereum is currently declining. It is extremely disturbed.

With each bullcycle, there is a moment that most people think that Ethereum will never get home after a big bearish event as you can see on the chart.

We just had a moment like that. pic.twitter.com/wprv7loxlr

– Crypto Caesar (@cryptocaesarta) March 25, 2025

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