Over One Million Ethereum Worth $4.3B Burnt Since London Upgrade

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The burn­ing mech­a­nism that was intro­duced as a part of the Ethereum Lon­don upgrade in ear­ly August has now destroyed more than one mil­lion ETH.

The Lon­don hard fork in ear­ly August intro­duced EIP-1559, a mech­a­nism to burn a por­tion of the trans­ac­tion fees. Since then, 1,008,431 ETH has been burnt at the time of writ­ing accord­ing to the Ultrasound.Money tracker.

At cur­rent prices of around $4,300, that is equiv­a­lent to a whop­ping $4.3 bil­lion. Ethereum passed the $1 bil­lion burned mile­stone in mid-September.

The mile­stone was observed by Ethereum advo­cates on cryp­to twit­ter, but those using the net­work on lay­er 1 are still suf­fer­ing those painful trans­ac­tion fees.

The cur­rent dai­ly burn rate is 11,588 ETH worth around $50 mil­lion per day. Over the past 24 hours, the net­work has destroyed 8 ETH per minute on aver­age. At these rates, the net­work will burn rough­ly 4.2 mil­lion ETH per year which is $18 bil­lion at cur­rent prices.

Uniswap is the leader of the burn table at the moment, destroy­ing 1,360 ETH, or $5.8 mil­lion, over the past 24 hours. It is not sur­pris­ing con­sid­er­ing a sim­ple token swap on the DEX can cost as much as $100 in gas at the moment.

Deflationary bonus  

The burn rate means that Ethereum sup­ply infla­tion has been reduced to just 1% per year since there are 5.4 mil­lion ETH cur­rent­ly mined per year.

The net­work switched to a defla­tion­ary issuance sev­er­al times over the past cou­ple of months as more ETH was being burnt than being produced.

Once “the merge” takes place some­time in the first half of 2022, the issuance is expect­ed to become ful­ly defla­tion­ary. The sim­u­la­tion cur­rent­ly esti­mates that Ethereum issuance will be ‑3.2% per year mean­ing that the sup­ply will decrease.

The merge occurs when the cur­rent ETH 1.0 chain will merge or “dock” with ETH 2.0 Bea­con Chain mark­ing the end of proof-of-work and a tran­si­tion to proof-of-stake.

Before that hap­pens, the Arrow Glac­i­er update will be deployed in ear­ly Decem­ber to extend the Ethereum dif­fi­cul­ty bomb.

ETH 2.0 Update

Ethereum staked on the Bea­con Chain cur­rent­ly totals around 8.37 mil­lion ETH accord­ing to Beaconcha.in. This is worth approx­i­mate­ly $36 bil­lion and works out as 7% of the entire supply.

Stak­ers can enjoy annu­al earn­ings of around 5.2% in which is soon about to become a defla­tion­ary asset.

In terms of price, ETH is cur­rent­ly trad­ing flat on the day at $4,287 accord­ing to CoinGecko. The asset has retreat­ed 12% from its Nov 10 all-time high of $4,878.

Disclaimer


All the infor­ma­tion con­tained on our web­site is pub­lished in good faith and for gen­er­al infor­ma­tion pur­pos­es only. Any action the read­er takes upon the infor­ma­tion found on our web­site is strict­ly at their own risk.



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