In Brief:
- Ethereum showed deflationary issuance continuously in the second week
- After the launch of the London hard fork, Ethereum burnt more than 700,00 ETH
- The rate of Ethereum burning is more than Ethereum mining
Ethereum Network has been entering into the first consecutive week of negative supply as the crypto market is continuously taking high transaction fees.
In August, the Ethereum blockchain initiated the London hard fork, and since then more than 700,000 Ethereum has been burned, whose value is nearly $2.4 billion as per the current market value.
As gas prices are still high, Ethereum has seen seven consecutive days of deflationary issuance for the network, which means more Ethereum were removed or burnt from Blockchain than created through mining.
EthHub co-founder Anthony Sassano was surprised that he was not expecting deflationary Ethereum until the “merge”. The “merge” he used in the context of the implementations of Ethereum 2.0’s Beacon chain, which is expected to occur in the first half of 2022.
According to the fee burning tracker, roughly 15,000 ETH ($65 million) have been burning every day. When factoring in the rate of new ETH being created, The net issuance of minus 8,034 ETH at the time of writing.
According to Etherscan, the average cost of an ERC-20 token transfer is $46, which is high. On the other hand, the token swap or uniswap can cost $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.
