According to Coin Metrics, Ethereum transaction fees for May 2021 are on the verge of breaking the current monthly record of $722 million sometime today, with May still a full two weeks away.

If this trend continues, the Ethereum network’s second-quarter transaction fee revenue will exceed its first-quarter record by the end of May, reaching an estimated $1.7 billion.

GAS revenue in USD is the product of transaction fees and Ethereum unit price. Total transaction fees on Ethereum have never been higher due to the current high demand on the network and new records for ETH prices.

The previous transaction fee high was three months ago, in February 2021.

Every time someone uses the Ethereum network to transfer funds or use a smart contract (automated code that interacts with them, such as bidding on an NFT in an auction or exchanging assets on a decentralized exchange), users must pay a certain fee, and eventually Miners will receive freshly mined ETH handling fees, which is an additional subsidy.

Transaction fees vary based on network congestion. The more transactions on the entire network, the higher the gas fee for transactions will be if users are willing to pay a premium.

As such, this month’s record transaction fees are indicative of both overall network usage and Ethereum’s price. According to data from Nomics, ETH reached an all-time high a week ago, breaking through $4,300.

If Ethereum was a company, as former Ark Investment analyst James Wang imagines, these revenue numbers would be impressive. Wang pointed out: "Ethereum's annual revenue, based on April data, reached $8.6 billion, comparable to Amazon Web Services in 2015." Over the next five years, Amazon Web Services' revenue increased by 575%, and Ethereum Fans also hope to achieve the same.

But it depends on whether Ethereum can scale more businesses. Each block in the Ethereum network can only handle a limited amount of transactions, and the network is approaching the capacity limit. A new record for transaction fees will not depend on more transactions, but on rising ETH prices and users' willingness to pay higher gas fees to ensure transactions go through quickly.

Ethereum's July network upgrade, dubbed the "London" upgrade, will include Improvement Proposal (EIP) 1559, a controversial plan that would have gas prices set automatically and then burn that fee instead of paying to the miners. In order to achieve the purpose of reducing the supply of Ethereum, increasing market demand, and eliminating certain network congestion.

While the new upgrade will reduce transaction fees by a certain percentage, the real shift won't happen until Ethereum 2.0 is fully implemented.

Unlike current networks that rely on energy-intensive hardware for "mining," the new proof-of-stake network will secure the network by letting users lock their tokens in smart contracts. Ethereum 2.0 promises to drastically reduce congestion and allow thousands of transactions per second instead of the 15 or so on the current network, which will bring transaction costs down to more reasonable levels.

But until Ethereum 2.0 is implemented, miners will still enjoy record fee income during the network transition.