How EIP-4844 Changed Ethereum Gas Prices

TLDR

This study analyzes 12 months of Ethereum gas price data to measure the impact of EIP-4844 (Proto-Danksharding) on Layer 1 transaction costs. By comparing 6 months before and after the March 13, 2024 upgrade, we found that average gas prices dropped 58.5%, median prices fell 67.5%, and expensive gas days decreased by 90.9%. Perhaps most significantly, cheap gas days increased from 2.2% to 50.8% of all days—a 2,225% increase. These findings demonstrate that EIP-4844’s benefits extended beyond Layer 2 rollups to improve costs for all Ethereum users.

1. Introduction

What is EIP-4844?

On March 13, 2024, Ethereum activated EIP-4844 (Proto-Danksharding) as part of the Dencun upgrade. This protocol change introduced a new type of transaction called “blob-carrying transactions,” which create temporary data storage specifically designed for Layer 2 rollups. Each blob can hold up to 128 KB of data and is stored for approximately 18 days before being deleted, unlike traditional calldata which remains on-chain permanently.

The primary goal of EIP-4844 was straightforward: make Layer 2 solutions cheaper. By providing L2s with a dedicated, lower-cost data availability layer, the upgrade aimed to reduce the fees users pay on rollup networks like Arbitrum, Optimism, and Base.

The Expected Impact

Following the upgrade, the Ethereum community witnessed dramatic fee reductions on Layer 2 networks:

• Arbitrum fees dropped from approximately $0.37 to $0.012 per transaction
• Optimism saw similar reductions from $0.32 to $0.009
• Base experienced even more dramatic drops to around $0.0005

These results aligned with predictions that Layer 2 transaction costs would decrease by 90% or more. The rollup-centric scaling approach appeared to be working exactly as intended.

The Unasked Question

While the Ethereum community celebrated these Layer 2 improvements, a fundamental question remained unexplored: What happened to Layer 1 gas prices?

Most analyses focused exclusively on blob fees and Layer 2 cost reductions. But if EIP-4844 moved Layer 2 data from calldata to blobs, wouldn’t that free up capacity on Layer 1? And if Layer 1 had more available capacity, wouldn’t that reduce gas prices for everyone using the mainnet?

Research Question

This analysis seeks to answer: Did EIP-4844 affect Ethereum mainnet gas prices, and if so, by how much?

Our hypothesis is simple: by moving Layer 2 data to a separate fee market, EIP-4844 should have reduced competition for Layer 1 block space, potentially lowering gas prices for all mainnet users—not just those using Layer 2 solutions.

2. Methodology

Data Collection

We obtained historical gas price data from Etherscan, Ethereum’s official block explorer. The dataset contains 3,769 daily observations spanning from July 30, 2015 to November 22, 2024, providing comprehensive coverage of Ethereum’s entire mainnet history.

Each daily record includes:

• Date (UTC)
• Unix timestamp
• Average gas price in Wei

We converted all values from Wei to Gwei (1 Gwei = 1 billion Wei) for readability, as Gwei is the standard unit for discussing gas prices in the Ethereum community.

Analysis Period

To isolate the impact of EIP-4844, we compared two symmetrical periods:

BEFORE Period (Calldata Era):

• Start: September 13, 2023
• End: March 12, 2024
• Duration: 182 days

AFTER Period (Blob Era):

• Start: March 13, 2024
• End: September 11, 2024
• Duration: 183 days

This 6-month window on each side of the March 13, 2024 upgrade date provides sufficient data for statistical comparison while remaining recent enough to minimize confounding factors from broader market changes.

Metrics Analyzed

We calculated multiple metrics to capture different aspects of the gas market:

Central Tendency:

• Mean (average gas price)
• Median (typical user experience)

Variability:

• Standard deviation (price volatility)
• Range (maximum minus minimum)
• Quartiles (25th and 75th percentiles)

Market Behavior:

• High gas days: Percentage of days exceeding 50 Gwei
• Low gas days: Percentage of days below 10 Gwei

Risk Measures:

• Coefficient of variation (normalized volatility)
• Maximum observed price (worst-case scenario)

Statistical Approach

This is an observational study using descriptive statistics and visual analysis. We did not employ predictive modeling or attempt to isolate EIP-4844 from all possible confounding factors. Instead, we document the observable changes in gas prices coinciding with the upgrade and provide plausible explanations based on the known mechanics of the protocol change.

Limitations

Several limitations should be noted:

1. Causation: We cannot definitively prove EIP-4844 caused the observed changes, only that changes coincided with the upgrade
2. Time window: Six months captures short-term effects but may miss longer-term trends
3. External factors: Market conditions, network usage patterns, and other variables changed during the study period
4. Scope: We analyzed only Layer 1 gas prices; we did not examine blob fees or Layer 2-specific metrics

3. Results

Result 1: Gas Prices Dropped Dramatically

The most striking finding is the magnitude of the price reduction. Comparing the 6-month periods before and after EIP-4844:

Mean gas price:     33.24 → 13.78 Gwei  (58.5% decrease)
Median gas price:   30.49 → 9.91 Gwei   (67.5% decrease)

The average Ethereum user now pays approximately 60% less in gas fees than before the upgrade. The median drop of 67.5% is even more significant because median better represents the typical user experience, as it isn’t skewed by extreme outlier days.

To put this in practical terms: a transaction that cost $5 in gas fees before EIP-4844 would now cost approximately $2. For users making multiple transactions per week, this represents substantial savings that compound over time.

The box plot visualization clearly illustrates this transformation. The entire distribution of gas prices shifted downward, with the median (red line) dropping from around 30 Gwei to under 10 Gwei. The interquartile range—representing where 50% of all days fall—compressed significantly, indicating not just lower prices but also less variability around that lower baseline.

Result 2: Gas Prices Became More Stable

Beyond the average reduction, gas price volatility decreased substantially:

Standard deviation:  17.65 → 11.42 Gwei  (35.3% decrease)
Maximum price:       98.68 → 64.57 Gwei  (34.6% decrease)
Range:              90.74 → 62.35 Gwei  (31.3% decrease)

The time series graph provides the most compelling visual evidence of EIP-4844’s impact. The chart shows daily gas prices over the full 12-month period, with a vertical green line marking March 13, 2024—the date of the Dencun upgrade.

Before this date, the gas price line shows considerable volatility, frequently spiking above 50 Gwei and occasionally reaching nearly 100 Gwei. The 7-day moving average (red line) fluctuates between 20 and 50 Gwei throughout most of the pre-upgrade period.

After March 13, the character of the data changes dramatically. The gas price line compresses into a much tighter range, rarely exceeding 30 Gwei and spending most days between 5 and 20 Gwei. The 7-day moving average drops to around 13 Gwei and remains relatively stable at this level.

This increased stability has important implications for users:

• Predictability: Users can more accurately estimate transaction costs
• Planning: Developers can build applications with clearer cost structures
• Accessibility: Users are less likely to encounter unexpectedly high fees

The coefficient of variation—a normalized measure of volatility that accounts for changes in the mean—increased slightly from 0.53 to 0.83. While this might initially seem contradictory, it simply reflects that volatility didn’t decrease quite as much as the mean, resulting in a higher relative volatility. However, the absolute volatility (standard deviation) decreased significantly, which is what matters most to users paying fees.

Result 3: The Market Distribution Fundamentally Changed

The histogram comparing before and after distributions reveals a structural shift in the gas market. Rather than just seeing prices move downward, we observe a complete reshaping of how gas prices are distributed.

Before EIP-4844:

• Distribution spread widely from 10 to 90 Gwei
• Peak density around 30-40 Gwei
• Relatively flat distribution (many price points equally likely)

After EIP-4844:

• Distribution concentrated between 5 and 25 Gwei
• Sharp peak around 8-12 Gwei
• Long tail extends to higher prices but with very low frequency

The quartile data quantifies this shift:

25th percentile:  19.48 → 6.53 Gwei   (66.5% decrease)
75th percentile:  43.06 → 16.93 Gwei  (60.7% decrease)

This means that even on relatively expensive days (75th percentile), gas prices are now 60% lower than they were during expensive days before the upgrade. The “new normal” for Ethereum gas prices has fundamentally changed.

Result 4: Cheap Days Became the Norm, Expensive Days Nearly Vanished

Perhaps the most dramatic finding emerges when we categorize days by their average gas price:

High Gas Days (>50 Gwei):

Before:  33 days  (18.1% of all days)
After:    3 days  (1.6% of all days)
Change:  -90.9% reduction

Before EIP-4844, users faced expensive gas days (>50 Gwei) nearly one day in five. These were days when even simple transactions could cost $10-20 or more. After the upgrade, such expensive days became rare—occurring only 1.6% of the time, or roughly once every two months.

Low Gas Days (<10 Gwei):

Before:   4 days  (2.2% of all days)
After:   93 days  (50.8% of all days)
Change:  +2,225% increase

The transformation on the low end is even more striking. Cheap gas days, which were rare before EIP-4844 (2.2% of days), became the majority after the upgrade (50.8% of days). This represents a 2,225% increase—not a typo.

Half of all days now feature gas prices below 10 Gwei, a threshold that was almost never reached before the upgrade. For context, at 10 Gwei, a simple ETH transfer costs approximately $0.50-1.00, making Ethereum practical for everyday transactions.

The stacked bar chart visualization makes this reversal impossible to miss. Before EIP-4844, the composition was roughly:

• 18% expensive (red)
• 80% medium (orange)
• 2% cheap (green)

After EIP-4844:

• 2% expensive (red)
• 47% medium (orange)
• 51% cheap (green)

The market essentially flipped from occasionally-cheap to majority-cheap.

Summary Statistics Table

4. Discussion

Why Did This Happen?

The most plausible explanation for these dramatic reductions lies in understanding what EIP-4844 changed about Layer 2 operations.

Before EIP-4844:

Layer 2 rollups needed to post transaction data to Ethereum Layer 1 for data availability guarantees. They did this using calldata—the same resource that regular Ethereum users compete for when making transactions. This created direct competition:

• Regular users trying to send ETH, trade tokens, or mint NFTs
• Smart contracts executing complex DeFi operations
• Layer 2 rollups posting batches of compressed transaction data

All these activities competed for the same limited block space, driving up gas prices for everyone.

After EIP-4844:

Layer 2 rollups moved their data to blobs, which exist in a separate fee market. Blobs have their own pricing mechanism (blob base fee) that operates independently from regular gas prices. This effectively removed Layer 2s from competition for calldata space.

According to various analyses, Layer 2 data posting accounted for approximately 20% of Layer 1 gas consumption before EIP-4844. When this 20% of demand shifted to the blob market, it freed up corresponding capacity in the regular transaction market, allowing gas prices to fall.

The Economic Mechanism:

This is a straightforward supply and demand dynamic:

1. Total Layer 1 block space (supply) remained constant
2. Demand from Layer 2s (~20%) shifted to blob market
3. Remaining demand (80%) now had more space available
4. With more available space, prices fell to clear the market

The magnitude of the effect (58.5% average reduction) might seem larger than expected from removing 20% of demand, but this likely reflects non-linear demand curves and the elimination of competition during peak congestion periods.

Who Benefits?

The conventional narrative around EIP-4844 focused exclusively on Layer 2 users benefiting from reduced rollup costs. Our analysis reveals a broader set of beneficiaries:

NFT Traders and Collectors:
Minting and trading NFTs on Layer 1 became substantially cheaper. A mint that might have cost $20 in gas during peak periods before EIP-4844 now typically costs $3-5.

DeFi Users:
Token swaps, liquidity provision, lending, and other DeFi operations on Layer 1 all became more affordable. This is particularly important for smaller positions where gas fees previously represented a significant percentage of the transaction value.

Regular ETH Users:
Simple peer-to-peer ETH transfers and wallet operations cost less, making Ethereum more practical for everyday use rather than just high-value transactions.

Smart Contract Developers:
Contract deployment and interaction became cheaper, reducing the barrier to entry for new developers and experimental projects.

Layer 2 Users (Indirectly):
While Layer 2 users primarily benefit from the direct blob fee reductions, they also benefit when they need to bridge assets to or from Layer 1, as those bridging transactions now cost less in gas.

The key insight is that EIP-4844 created a win-win scenario: Layer 2s became 90%+ cheaper through blobs, AND Layer 1 became 60% cheaper through reduced competition.

Alternative Explanations

We should consider whether factors other than EIP-4844 might explain the observed gas price reductions:

Reduced Network Activity?
If overall Ethereum usage decreased after March 2024, gas prices would naturally fall. However, Layer 2 activity increased substantially after the upgrade, and total value locked (TVL) in Ethereum DeFi remained stable. This suggests network activity did not decline.

Cryptocurrency Market Conditions?
Both the before and after periods included both bull and bear market phases. While market conditions certainly affect gas prices, the magnitude and timing of the change aligns precisely with the March 13 upgrade.

Other Dencun EIPs?
The Dencun upgrade included other Ethereum Improvement Proposals beyond EIP-4844. However, EIP-4844 was by far the most significant change in terms of block space economics, making it the most likely driver of gas price changes.

Seasonal Patterns?
Both periods covered the same months (September-March, March-September), controlling for seasonal effects.

While we cannot definitively rule out all alternative explanations, the timing, magnitude, and structural nature of the changes strongly suggest EIP-4844 as the primary cause.

5. Conclusion

Summary of Findings

This analysis of 12 months of Ethereum gas price data reveals substantial reductions in Layer 1 transaction costs following the March 13, 2024 activation of EIP-4844:

• Average gas prices fell 58.5%, from 33.24 to 13.78 Gwei
• Median prices dropped 67.5%, from 30.49 to 9.91 Gwei
• Price volatility decreased 35.3%, making costs more predictable
• Expensive days (>50 Gwei) declined 90.9%, from 18.1% to 1.6% of days
• Cheap days (<10 Gwei) increased 2,225%, from 2.2% to 50.8% of days

These changes represent not merely a temporary reduction but a fundamental shift in the Ethereum gas market. What was once expensive became moderate, and what was once rare became common.

Why This Matters

The significance of these findings extends beyond the numbers:

For Users:
Ethereum became substantially more affordable for everyday transactions. Activities that were previously cost-prohibitive at certain times—small NFT purchases, modest DeFi positions, frequent transfers—became economically viable.

For Developers:
Lower and more predictable gas costs enable new categories of applications. Micro-transactions, frequent state updates, and gas-intensive operations all became more practical to implement on Layer 1.

For Ethereum:
The protocol demonstrated its ability to scale through architectural improvements rather than just hardware scaling. The rollup-centric roadmap showed tangible benefits not just for Layer 2 users but for the entire ecosystem.

For Blockchain Research:
EIP-4844 provides evidence that multi-dimensional fee markets can work in practice, and that protocol upgrades can have beneficial spillover effects beyond their primary objectives.

The Broader Implication

Most discussions of EIP-4844 centered on its direct impact: making Layer 2 rollups cheaper through blob transactions. This analysis reveals an important secondary effect: by removing Layer 2 data from competition for Layer 1 block space, the upgrade made Ethereum mainnet cheaper for everyone.

This is not a zero-sum game where Layer 2 gains came at Layer 1’s expense. Instead, careful protocol design created a positive-sum outcome where both layers became more affordable simultaneously. Layer 2s saw 90%+ fee reductions through blobs, while Layer 1 users enjoyed 60% reductions through freed capacity.

Final Thought

When EIP-4844 launched, the Ethereum community celebrated dramatically lower Layer 2 fees. What went largely unnoticed was an equally important achievement: dramatically lower Layer 1 fees.

By moving Layer 2 data to blobs, Ethereum didn’t just make rollups cheaper—it made the entire network more affordable and accessible. The protocol upgrade succeeded beyond its stated goals, creating unexpected benefits for all users.

EIP-4844 didn’t just help Layer 2 users. It helped everyone.

Data and Code Availability

All data and analysis code used in this study are publicly available at:

GitHub Repository: https://github.com/0xRuangsak/eip4844-gas-market-analysis