111 days ago, the Ethereum network implemented the London hard fork upgrade which added a mechanism (EIP-1559) that changed Ethereum’s fee rate to a new scheme that makes the crypto asset ether deflationary. Since then 1 million ether has been burned or the equivalent of around $3.8 billion worth of ethereum using today’s exchange rates.
To date, over a million Ethers or $3.8 Billillion have been burned
Currently, ethereum is the second largest crypto asset by market capitalization. Its overall value today stands at just over $500 billion. Ethereum’s market capitalization represents 18.8% of the $2.7 trillion crypto economy. The Ethereum blockchain’s August 5th, 2021 upgrade added many features to the consensus rules. EIP-1559, EIP-3554 and EIP-1559 were the most significant. EIP-1559 created a fee structure that allowed the network to use a percentage of its ether.
EIP-1559’s summary hosted on Github states:
A protocol has a base fee for each gas. It can adjust the block’s price based on a formula. The formula is a function block gas limit and target. (Block gas limit divided with elasticity multiplier) This algorithm causes the base fee per gaz to increase when blocks reach the gas goal, while decreasing when they fall below that gas target. Burned gas earns the base fee.
Since the new feature was introduced, metrics from Dune Analytics indicate 1,001,212 ether or $3.8 billion worth of ethereum using today’s exchange rates has been burned.
At the time of writing, etherscan.io’s API which shows the circulating ETH supply indicates that there’s 118,472,428 ether in existence today. Opensea, a non-fungible token marketplace (NFT), is the largest ethereum user today with 110.081 ether and $398 million.
Opensea-related burning occurred across 7,941,975 Ethereum Transfers. The tethering of regular ethereum transactions has been increased to 94 800 ETH since August’s upgrade. Decentralized exchange (dex), platform Uniswap V2(version 2), is third in ethereum burning since the upgrade. 92,239 ether or $373 million worth of ethereum using today’s exchange rates has been burned stemming from Uniswap V2 usage.
Ethereum is often burned using the usd coin and stablecoins USDT. Uniswap’s V2 is fourth-largest ethereum torcher, while tether (USDT), is seventh. Through 11,499,787 transfer, tether has contributed to the burning of 53,988ether or $210,000,000. USDC was responsible for the current burning of 20,042ether, which is $77 million. The burning of large amounts of ether is also possible with other applications, such as Metamask (or 1inch), Sushiswap and Axie Infinity.
Let us know your thoughts on the 1,000,000 ether burned in August 5. Comment below and let us know how you feel about the subject.
Images CreditsShutterstock. Pixabay. Wiki Commons. Dune Analytics.
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