In December, major blockchain networks processed more transactions even as user fees dropped, indicating that recent scaling enhancements are improving capacity and reducing competition for block space, based on data from Nansen.
Nansen’s data revealed that Bitcoin, Tron, Ethereum, Arbitrum, Polygon, Avalanche, and The Open Network (TON) all experienced month-over-month transaction increases, although fee revenue sharply declined during the same time frame.
Ethereum saw a 16% rise in transactions despite a 57% drop in fee revenue. Similarly, Polygon’s transaction count surged by 82% while fees decreased by 47%. Arbitrum and Avalanche also displayed a distinct trend of increased transactions coupled with decreased fees.
Tron, Bitcoin, and TON experienced modest transaction growth of 0.6%, 7.7%, and 7.9%, respectively, while also witnessing decreases in fee revenue, further illustrating the broader trend of reduced blockspace pressure across networks.
The emerging trends suggest a fundamental shift in how blockchains manage demand. Recent upgrades, rollups, and cost-effective execution environments have expanded capacity without causing congestion or competitive bidding for space.
Nansen’s artificial intelligence help section indicates that percentage-change figures reflect relative shifts compared to recent activity baselines, rather than strict month-over-month comparisons.
This means that sudden reversals or outflows can show declines greater than 100%, indicating a net negative in activity momentum rather than an actual “negative transaction” count.
Transaction growth amid declining fees across major networks
On November 27, Ethereum increased its block gas limit to 60 million, accommodating more transactions and contract calls in each block and reducing congestion.
The impact was amplified in December with the Fusaka upgrade, which introduced PeerDAS to significantly enhance data availability and lower costs for rollups, alleviating fee pressure as activity level rose.
Polygon followed a similar trend after its Madhugiri hard fork in early December. As previously noted by Cointelegraph, this upgrade reduced consensus time to one second and aimed to improve throughput by up to 33%, making gas-intensive operations more efficient and predictable.
The network strategically focused the upgrades around stablecoins and real-world asset (RWA) tokenization, which typically produce frequent but low-urgency transactions, enhancing volumes without significantly increasing fees.
Simultaneously, Avalanche’s performance appears to stem from various ecosystem activities.
Nansen Research’s Avalanche Ecosystem Report indicated that its transaction growth results from stablecoin payments, institutional settlements, and consumer platforms like ticketing and gaming.
These use cases drive high throughput but create little competition for blockspace, enabling rising transaction volumes while fees drop.
Similarly, Arbitrum’s pattern follows the economics of rollup scaling. The network batches transactions off-chain and compresses data for Ethereum, allowing transaction volumes to escalate without proportional fee increases.
Its fee market design decouples execution costs from Ethereum calldata costs, smoothing fee volatility even under higher loads.
Related: Memecoins transition from festive cheer to stark reality, sinking 65% over the year
Not all networks experienced the same divergence
While several notable blockchains recorded higher transaction counts alongside falling fees, others saw declines in both activity and fee revenue, indicating a quieter onchain environment over the past 30 days.
BNB Chain suffered a significant contraction, with transactions plummeting by 79% and fees decreasing by 14%. Base and HyperEVM had some of the most severe declines in activity.
Base transactions dropped by 75%, while fee revenue fell by 63%. HyperEVM exhibited a similar trend, with transactions down 119% and fees dropping by 46%, highlighting diminished short-term usage throughout December.
Meanwhile, Solana retained its status as the busiest network, processing 1.7 billion transactions. However, this figure represented a 21% month-on-month drop, according to Nansen. Fee revenue for the network also fell by 17%.
These synchronized declines align with the overall conditions of the crypto market. As per CoinGecko, the total market capitalization fluctuated between roughly $2.9 trillion and $3.1 trillion throughout December.
With prices, volatility, and capital rotation remaining stagnant, onchain activity across networks subsequently cooled.
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