Since the execution of Ethereum Improvement Proposal (EIP) 1559 via the London hard fork on August 5, about $6.3 billion of the second-largest cryptocurrency by market capitalization, Ethereum ($ETH), has been burned.
According to data from the tracking website Watch the Burn, 2.274 million ether worth $6.27 billion has been burned since August, with an average of 355 ETH worth more than $1 million burned per hour and 4,900 ETH burned per day.
Ethereum’s net issuance per day has plummeted to roughly 8,300 ETH, implying a net reduction of around 37.15 percent. According to some observers, ETH might become a deflationary currency if burns outstrip net issuance, which has happened on a few blocks.
The London hard fork includes the adoption of Ethereum Improvement Proposal (EIP) 1559, which altered the way network transaction fees function. Instead of an auction system, users now pay a flat charge for their transactions to be processed by miners and can tip miners to have their transactions processed faster.
Miners are not paid the base fee since it may encourage them to purposefully congest the network in order to maintain it high and earn more. Instead, the base fee is burned, thus removing ether from the market for good. It rises when demand is high and falls when demand is low.
Analysts anticipated that $5 billion in ETH may be burned in a year at the time of the update. The current statistic indicates that far over $5 billion has already been consumed.
Following the London hard fork, some investors have been positive on ETH. Former Goldman Sachs executive Raoul Pal, for example, has stated that he believes Ethereum is the “greatest trade” setup he has ever seen, as the cryptocurrency’s fundamentals indicate it has a significant upside ahead of it.
trade of cryptocurrencies According to Coinbase, ETH staking rewards might double if the network merges with the Proof-of-Stake (PoS) Beacon Chain, which is presently running alongside Ethereum’s mainnet.
Coinbase stated that after the Ethereum mainnet merges with the Beacon Chain – a step that is “anticipated around June of this year” – ETH staking yields may increase because “rewards will incorporate net transaction (ex-base) fees currently paid to miners.”