Blob fees have been persistently low, which is more bearish than bullish for ETH. They directly cause ETH inflation and weaken value capture, but their existence is a necessary cost to keep the L2 ecosystem thriving.
Step 1: Understanding the Role of Blob Fees — What They Replaced
Blobs are a temporary storage space introduced by EIP-4844 specifically for L2s, and they are 10–100 times cheaper than the old method. The original goal of this design was to lower L2 costs, reduce transaction fees for L2s, and expand the user and application ecosystem.
Ethereum Foundation core researcher Dankrad Feist said something highly controversial in a September 2024 AMA: "The revenue from 3 blobs per block will never have an impact on Ethereum's protocol revenue. Either way, I don't think blob fees will be Ethereum's best value capture mechanism."
This statement hits the core issue: blob design was never meant to earn money for ETH.
Step 2: Core Reasons for Persistently Low Blob Fees
After the Dencun upgrade, L2s pay extremely low fees to use blobs. In about 150 days after launch, the average cost per blob was only $1.59, and a total of 2,408 ETH was burned. During the same period, L2 operating costs fell by about 80%, and Optimistic Rollup profit margins soared from 22.65% to 92.3%.
The impact on ETH is direct. Before EIP-4844, peak L2 gas consumption accounted for over 10% of total mainnet gas; it then plunged to around 1%. Base fees were largely diverted to L2s, causing a sharp drop in mainnet revenue. Total L1 revenue fell by 69% compared to pre-upgrade, and the amount of ETH burned fell by 84%. As a result, ETH has re-entered a mild inflationary state.
High-risk note: Currently, around 84% of validator income still relies on token incentives (newly issued ETH), not fees paid by users. If ETH's price weakens, the dilution effect of inflation on holders will be magnified.
Step 3: Benefits and Costs — Balancing Two Forces
Bearish side:
ETH value capture weakens: L2 transaction volumes are rising, but mainnet revenue is falling. In Q2 2025, Ethereum mainnet captured only 4.9% of the economic value generated by the application layer, and blob fees accounted for only 2% of total protocol revenue.
Token deflation expectations vanish: This was an important part of the market's valuation logic for ETH. Persistently low blob fees mean this logic does not hold for now.
Bullish side:
L2 ecosystem scale effects: Without low blob fees, the L2 cost structure could not support the current level of transaction volume and user base. This is part of Ethereum's shift from B2C to B2B — turning the mainnet into a settlement layer and handing users and apps over to L2s.
Long-term network effects: Fidelity pointed out in a 2025 report that a low-fee strategy helps retain L2 projects. The emergence of more specialized L2s could drive network adoption, and over the long term, adoption growth might outpace token issuance.
How to check: Go to Dune Analytics or ultrasound.money and look at ETH's net supply change. If the 7-day or 30-day change is positive, it means ETH is still in an inflationary state. Persistently low blob fees mean this short-term situation won't change soon. The key is not to wait for them to "rise," but to see if L2 ecosystem growth can prove the value of this model over the long term. If L2 transaction volume needs to increase 92 times just to replace existing L1 revenue with DA fees, the road ahead is still very long.
