Transaction fees are about $.50 these days, depending on time of day, obviously. What happens when they are $5.00? Well I'd argue any transaction <$20 would be unthinkable, and anything up to $100 would be rare. Anybody DCAing into self custody would need to keep their funds in their CEX for even longer. Anybody using DEXs like Bisq would be priced out of smaller transactions.

This situation looks real grim in the advent of $50 transactions (assume today's money for all of these prices). People keep their money in CEXs for much much longer, probably only withdrawing into self custody every few thousand dollars worth, if even. The Bisq market would likely be devoid of sub $1000 transactions.

Another factor too is the safety of the lightning network. As it stands now, in case of dispute, channels can always be resolved on chain. When transactions are $0.50, at worse you lose $0.50. When transactions are $5 or $50, you stand to lose a lot if there are bad actors trying to double spend or other attacks. Transaction fee decreases lightning security as it stands NOW, but I'm hopeful innovations like channel splicing, sidechains, etc. could resolve this threat.