$ 30 Million worth of Ethereum Burned Just Two Days After EIP-1559 Launch


  • Ethereum developers have implemented a network change that burns transaction fees.
  • Since that change, $ 30 million in ETH has already been burned.
  • NFT projects top the list for Ethereum gas burners with market leader OpenSea NFT.

Ethereum’s new EIP-1559 transaction fee management mechanism has removed $ 30 million worth of ETH from the network’s circulation since it went into effect two days ago.

EIP-1559, one of five updates introduced as part of the Ethereum hard fork in London on August 5, replaced Ethereum’s auction-style transaction fee mechanism with an algorithmically determined alternative.

Unless users specifically choose to “tip” miners, they will no longer receive transaction fees; instead, the fees are burned down, reducing the total supply of Ethereum in circulation.

According to data from the Ethereum Ultrasound tracker. Money, 1,332 ETH ($ 4.1 million) burned so far comes from transactions on the OpenSea NFT market, where trading volumes have risen since the CryptoPunks trading frenzy began last week.

second best ETH burner is the decentralized exchange Uniswap V2, where transactions burned 810 ETH ($ 2 million).

third is Axie Infinity, an Ethereum-based game in which players buy monstrous NFTs and battle each other. Axie Infinity burned 626 ETH ($ 1.9 million).

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NFT COVIDPunks project, a CryptoPunks knockoff with a pandemic twist, is the fourth gas-intensive Ethereum project, with 528 ETH ($ 1.6 million) burned.

In fifth place is Tether (USDT), a stablecoin with a market capitalization of $ 62 billion. Tether is based on the Ethereum network, in addition to Tron, and is responsible for 510 ETH ($ 1.5 million) burned. Stablecoins are cryptocurrencies “pegged” to a fiat currency on a 1: 1 basis.

the fusion

Ethereum hard fork in London may have completely changed the way miners are compensated on the blockchain, but more changes are yet to come. Soon, Ethereum will go from proof of work to proof of stake.

next item on the network’s agenda is ‘merger’, connecting the Ethereum mainnet to the Ethereum 2.0 beacon chain, when the current iteration of Ethereum connects to the next generation of the network.

Ethereum co-founder Vitalik Buterin said so Bloomberg Earlier this week, the London update is “proof that the Ethereum ecosystem is capable of making significant changes” and that it “gives me much more confidence about the merger.”

merger is also key to Ethereum’s stake, which is powering Ethereum 2.0. About 5% of all ETH is currently staked on ETH 2.0. this is around 6.5 million ETH, worth approximately $ 20 billion.

Alex Svanevik, CEO of blockchain analytics firm Nansen, said decrypt last month, this figure will rise after the merger as investors will be able to withdraw their staked ETH. Ethereum Foundation is scheduling a post-merger “cleanup” update to allow for ETH withdrawals in gambling and expects “to happen very soon after the merger is complete.”

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