More than $ 4.5 billion of Ethereum ($ ETH), the second largest cryptocurrency by market capitalization, has been burned since the Ethereum Improvement Proposal (EIP) 1559 was implemented via London’s Hard Fork on August 5. rice field.
According to data from the tracking website See burnsSince August, a total of $ 1.747 billion worth of Ethereum has been burned, with an average of 307 ETH per hour, $ 800,000 worth, and $ 32 million worth of Ethereum per day burning 12,300 Ethereum.
The net issuance of Ethereum per day has decreased to about 1,100 ETH. This means that the net savings are now over 91%. Some analysts estimate that ETH could become a deflationary currency if the burns exceed the net issuance that occurred in a few blocks.
The London hard fork included an implementation of Ethereum Improvement Proposal (EIP) 1559. This has changed the way transaction fees work on the network. Instead of an auction system, users now pay a base fee for transactions processed by miners. Alternatively, you can tip the miner to process the transaction faster.
Miners are not paid a base fee because they can artificially congest the network to keep it high and motivate them to earn more. Instead, the base charge is burned and the ether is effectively and permanently removed from the circulation. It goes up when demand is high and goes down when demand is low.
At the time of the upgrade, analysts estimated that $ 5 billion worth of ETH could be burned in a year. Current figures show that more than $ 5 billion is expected to be burned by August of this year.
After London’s hard fork, some investors were bullish on ETH. For example, Raulpal, a former Goldman Sachs executive, said Ethereum saidMaximum trade setting He has seen that cryptocurrency fundamentals suggest a greater advantage than that.
Similarly, Singapore-based cryptocurrency hedge fund Three Arrows Capital Invest over $ 80 million In cryptocurrency after its price fell below $ 4,000 at the end of last year.
Disclaimer
The views and opinions expressed by the author or those mentioned in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing or trading crypto assets carries the risk of financial loss.
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