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Total ETH Burned Tops the 2M Token Benchmark Worth Over $5B

by Blockchain NewsMarch 22, 2022

Since the EIP-1559 upgrade, also known as the London Hardfork went live in August last year, the Ethereum network and its underlying token have been operating as a deflationary protocol.

The implementation of the EIP 1559 upgrade stirred a number of changes in the Ethereum network, one of which is the burning of the transaction fees generated while miners are rewarded based on prioritized tipping paid by transaction initiators.

Since the upgrade went live, the Ether burn rate has hit a significant milestone, with over 2 million Ethereum coins burned thus far. In Accordance with data from Etherchain, exactly 2002146.0 ETH has been burnt, and this is worth approximately $5.87 billion based on the current price of ETH at $2,904.69, according to data from CoinMarketCap.

Per the Etherchain data, the Ethereum blockchain currently has a 50.9% block utilization time and a 2.71 ETH/Min burn rate. As reported by Blockchain.News, the protocol crossed the 1M burnt benchmark back in November of last year.

The London Hardfork was one of the many protocol upgrades that were generally targeted at reducing the pains of the Ethereum network users as congestion was climbing at an alarming rate with the accompanying inconvenience in the form of gas fees owing to bidding wars. With the hardfork going live, the network proposed a base network fee, cutting out the bidding wars.

While the EIP 1559 has contributed in no small measure to the growth and health of the network in terms of easing the usage costs, it has largely given more investors to consider a very bright future for Ethereum in the long run per the deflationary tendencies of the token. Despite the impressive strides of the London Hardfork and other upgrades the Ethereum network has recorded, the ultimate solution to the current scaling and high fees challenges of the protocol is Ethereum 2.0.

Until Ethereum 2.0, which has continued to gain steam per the total tokens staked, comes to life, the aftermaths of the EIP-1559 upgrade will continually be felt.

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Total ETH Burned Tops the 2M Token Benchmark Worth Over $5B

by Blockchain NewsMarch 22, 2022

Since the EIP-1559 upgrade, also known as the London Hardfork went live in August last year, the Ethereum network and its underlying token have been operating as a deflationary protocol.

Until Ethereum 2.0, which has continued to gain steam per the total tokens staked, comes to life, the aftermaths of the EIP-1559 upgrade will continually be felt.

Image source: Shutterstock

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Tagged : Burning / Eip 1559 / Ethereum / Ethereum 2.0

Ethereum EIP-1559 upgrade launches on Polygon to burn MATIC

by CointelegraphJanuary 18, 2022

The Ethereum upgrade that introduced a partial network fee burning mechanism in August last year has launched on the layer-two scaling network Polygon.

Ethereum’s EIP-1559 upgrade shipped with its London hard fork last summer and has been a success in terms of gas price predictability and network fee burning. The upgrade has now launched on the layer-two scaling network Polygon in an effort to improve “fee visibility”. It went live about an hour ago at block 23850000.

The Polygon team announced the upgrade date on Jan. 17, following its successful deployment on the Mumbai testnet.

The EIP-1559 upgrade introduces the same fee-burning mechanism to Polygon resulting in the destruction of MATIC tokens. It also removes the first-price auction method for calculating network fees which leads to better cost estimations but goes not reduce gas prices.

“The burning is a two-step affair that starts on the Polygon network and completes on the Ethereum network.”

The team stated that, just like Ethereum, the supply of MATIC is likely to become deflationary with 0.27% of the total supply being burnt every year according to estimations. There is a fixed supply of 10 billion MATIC tokens with 6.8 billion currently in circulation.

“Deflationary pressure will benefit both validators and delegators because their rewards for processing transactions are denominated in MATIC,” it added before stating that the upgrade would also reduce spam and network congestion.

Despite being a layer-two network, Polygon has suffered from its own gas crisis recently. Earlier this month, Polygon gas fees skyrocketed according to Dune Analytics resulting in some validators failing to submit blocks. The surge in demand was due to a DeFi yield farming game called Sunflower Land which rewarded early adopters before the degens lost interest.

Related: Here’s how Polygon is challenging the limitations of Ethereum

Since going live on Ethereum around six months ago, the upgrade has resulted in the burning of 1.54 million ETH to date according to the burn tracker. At current ETH prices, this works out at around $5 billion. The tracker also predicts that Ethereum issuance will become deflationary by -2.5% per year once “the merge” happens and proof-of-stake becomes the primary consensus mechanism for the network.

MATIC prices have dumped 9% on the day in a fall to $2.22 at the time of writing according to CoinGecko.

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Tagged : All News / Burning / Eip 1559 / Ethereum / Gas / Matic / Polygon

Ethereum is Burning at the Rate of 6.29 ETH per Minute

by Blockchain NewsDecember 16, 2021

Burnt Ether is edging closer to the 1.2 million ETH mark, given that it’s burning at a rate of 6.29 ETH, approximately $24,361, per minute.

Ever since the London Hard Fork or EIP 1559 upgrade went live on August 5, the burning feature was introduced every time Ethereum was used in transactions. One of the objectives was to eliminate the inflationary tendencies that the network was accustomed to because Ethereum would become scarce after being burnt.

Furthermore, users who wished to conduct their transactions faster than the standard provisions of the network were allowed to offer validators a tip to fast-track their transactions. Part of this tip would be burnt, helping to improve the monetary policy of the Ethereum network as a whole.

Burnt Ether, coupled with ETH’s leaving exchanges in droves, has been causing a supply deficit.

On the other hand, the tussle between the top ten largest exchange and non-exchange addresses continue to play out. Market insight provider Santiment explained:

“The 10 largest Ethereum addresses on exchanges hold a cumulative 3.82M ETH, which is the lowest level since the exodus. Meanwhile, the top 10 largest non-exchange addresses hold a cumulative 24.78 ETH, closing in on the all-time high of 26.63 ETH attained in June 2016.”

Meanwhile, the debate about Bitcoin versus Ethereum seems not to be going away anytime soon because ARK Invest CEO Cathie Wood recently stated that ETH was still undervalued compared to BTC.

She added that Ethereum was still in the infancy stage and had a long journey ahead compared to Bitcoin that had already established itself as a monetary system.

Wood also noted that more institutional investments would trickle into decentralized finance (DeFi) and non-fungible tokens (NFTs), aiding Ethereum’s growth.

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Tagged : Analysis / Burning / Eip 1559 / Ethereum / London Hard Fork / Market

Ethereum is Burning at the Rate of 6.29 ETH per Minute

by Blockchain NewsDecember 15, 2021

Burnt Ether is edging closer to the 1.2 million ETH mark, given that it’s burning at a rate of 6.29 ETH, approximately $24,361, per minute.

Burnt Ether, coupled with ETH’s leaving exchanges in droves, has been causing a supply deficit.

On the other hand, the tussle between the top ten largest exchange and non-exchange addresses continue to play out. Market insight provider Santiment explained:

“The 10 largest Ethereum addresses on exchanges hold a cumulative 3.82M ETH, which is the lowest level since the exodus. Meanwhile, the top 10 largest non-exchange addresses hold a cumulative 24.78 ETH, closing in on the all-time high of 26.63 ETH attained in June 2016.”

She added that Ethereum was still in the infancy stage and had a long journey ahead compared to Bitcoin that had already established itself as a monetary system.

Wood also noted that more institutional investments would trickle into decentralized finance (DeFi) and non-fungible tokens (NFTs), aiding Ethereum’s growth.

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Tagged : Analysis / Burning / Eip 1559 / Ethereum / London Hard Fork / Market

Ether’s Net Issuance Dropped from Over 4% to 0.21% Last Week

by Blockchain NewsNovember 15, 2021

Ethereum (ETH) has enjoyed a rollercoaster ride this quarter by hitting historic highs in its 6-year journey.

The second-largest cryptocurrency based on market capitalization recently reached an all-time high (ATH) of $4,860, thanks to diminishing supply on its network.

Data analytic firm IntoTheBlock explained:

“A potential reason behind ETH rally is its decreasing supply. Since the deployment of EIP-1559, most of the Ether used as transaction fees has been burned or removed from circulation. Ether’s net issuance has dropped from over 4% to an average of just 0.21% this week.”

Ever since the London Hardfork or EIP 1559 upgrade went live on August 5, Ethereum has become deflationary because its value continues to increase with time on the foundation of slashed supply.

This improvement introduced scarcity on the Ethereum network every time Ether is burnt after being utilized in transactions. Therefore, this upgrade was meant to eliminate the inflationary tendencies this network was accustomed to before.

The dividends seem to be paying off because Ether worth more than $3 billion has been burned so far, causing a supply deficit.

The supply squeeze on the Ethereum network has been going through the roof based on a couple of reasons. For instance, more than 8 million ETH is locked in decentralized finance (DeFi), and at least 8.2 million ETH has been staked in Ethereum 2.0 deposit contract.

Ethereum’s address activity surges by 48%

According to on-chain metrics provider Santiment:

“Ethereum’s latest address activity is up about 48% since the number of unique ETH addresses bottomed out in late September.”

This, coupled with the fact that the number of non-zero ETH addresses hit a record high, shows that more participants are joining the Ethereum network.

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Tagged : #ETH / Blockchain / Burning / Deflation / Ethereum / London Hardfork / NET ISSUANCE / Scarcity

Ether’s Net Issuance Dropped from Over 4% to 0.21% Last Week: Potential Reasons Behind Ethereum’s Rally

by Blockchain NewsNovember 15, 2021

Ethereum (ETH) has enjoyed a rollercoaster ride this quarter by hitting historic highs in its 6-year journey.

The second-largest cryptocurrency based on market capitalization recently reached an all-time high (ATH) of $4,860, thanks to diminishing supply on its network.

Data analytic firm IntoTheBlock explained:

“A potential reason behind ETH rally is its decreasing supply. Since the deployment of EIP-1559, most of the Ether used as transaction fees has been burned or removed from circulation. Ether’s net issuance has dropped from over 4% to an average of just 0.21% this week.”

Ever since the London Hardfork or EIP 1559 upgrade went live on August 5, Ethereum has become deflationary because its value continues to increase with time on the foundation of slashed supply.

The dividends seem to be paying off because Ether worth more than $3 billion has been burned so far, causing a supply deficit.

Ethereum’s address activity surges by 48%

According to on-chain metrics provider Santiment:

“Ethereum’s latest address activity is up about 48% since the number of unique ETH addresses bottomed out in late September.”

This, coupled with the fact that the number of non-zero ETH addresses hit a record high, shows that more participants are joining the Ethereum network.

Image source: Shutterstock

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Tagged : #ETH / Blockchain / Burning / Deflation / Ethereum / London Hardfork / NET ISSUANCE / Scarcity

Ethereum sees first consecutive week of deflationary issuance

by CointelegraphNovember 2, 2021

The Ethereum network has seen its first consecutive week of negative supply issuance as bubbling markets drive persistently high transaction fees.

With the highly anticipated London upgrade introducing a burn mechanism into Ethereum’s fee market in early August, a small quantity of Ether has since been destroyed with every transaction executed on the network.

With gas prices sustaining at high levels, Ethereum has seen seven consecutive days of deflationary issuance for the network, meaning that more ETH has been removed from supply than created through mining.In order for Ethereum to consistently produce deflationary blocks, gas prices must consistently remain roughly above 150 gwei.

EthHub co-founder Anthony Sassano commented that deflationary Ethereum was not expected until “the merge” — when the Ethereum blockchain is set to merge with Eth2’s Beacon Chain, which is currently expected to occur during the first half of 2022.

According to the Ultrasound.Money fee burning tracker, around 15,000 ETH ($65 million at current prices) is being burnt daily. When factoring in the rate of new ETH being created, WatchtheBurn reports a weekly net issuance of minus 8,034 ETH (roughly $34 million) at the time of writing.

Since the London upgrade, more than 724,400 ETH worth $3.1 billion has been permanently destroyed.

According to Etherscan the average cost of an ERC-20 token transfer is now a painful $46. Doing something a little more complex such as providing liquidity to a DeFi protocol or making a token swap on Uniswap can cost as much as $140 at the moment.

Sassano emphasized that the upgrade has not increased gas prices but has made them more predictable. “Contrary to popular belief, EIP-1559 has not increased gas prices and has in fact helped considerably with spikes in demand (such as during hyped-up NFT mints) which has led to a smoother network overall,” he said.

According to the Bankless Ethereum Q3 network report, transaction value settled for July to September this year was a whopping $536.5 billion, an increase of almost 400% since the same period last year.

Related: Ethereum supply flips briefly into deflation as gas fees spike

Despite Ethereum’s first deflationary week, many Ether advocates are seeking to encourage users to migrate to transacting using its emerging layer-two ecosystem.

According to L2beat, there is a record $4.68 billion in total value locked across the various L2 networks. This TVL has surged almost 500% over the past two months as Ethereum users increasingly seek out ways to avoid those excruciating transaction fees.