The Ethereum London upgrade, one of the most anticipated Ethereum (ETH) hard forks has launched on Ethereum with a large number of burned ETH since it has been deployed. The Ethereum Improvement Proposal (EIP-1559) has now introduced a new mechanism that burns a part of the gas fee paid by users that transact in Ethereum.
Ethereum London Upgrade Goes Live
The new Ethereum London upgrade is active on the Ethereum network. Due to this reason, a large number of ETH coins have been burned. There have been several analysts that monitored the burning on the Ethereum network, and the results have been surprising.
According to data provided by Etherchain, more than 4,000 ETH have already been burned at the time of writing. The burn rate right now is at 2.85 ETH per minute, which represents a burn rate of 171 ETH per hour. That means that in 24 hours, over $11 million worth of ETH has already been burned.
Furthermore, this has had a positive effect on the price of Ethereum, which became one of the fastest-growing cryptocurrencies among the top 10. In the last 7 days alone, the virtual currency registered a price increase of over 16.4%.
With the new Ethereum London upgrade, the destruction of ETH coins will definitely have an impact on the total supply of coins. Additionally, in the near future, it might be possible for Ethereum to become a proof-of-stake (PoS) digital asset. In this way, the network will become deflationary as transaction fees will continue to be burned.
Let’s not forget that the Ethereum network has been growing with the expansion of the decentralized finance (DeFi) world. Due to this reason, transaction fees have been growing over time. This has created a situation in which transacting a small amount of ETH could result in paying a fee of over $50.
Despite the recent Ethereum London upgrade, the network is still inflationary. Which is not something that many crypto users like. Despite that, the inflation rate is quite low for Ethereum. Right now, with the Ethereum London upgrade, it might be possible for Ethereum’s inflation to reach a value between 1.25% and 2.66%.
With the recent expansion of the NFT industry, transaction fees on the Ethereum network have also gone up. This is similar to what happened on the Ethereum network when DeFi platforms expanded earlier this year. The new Ethereum London upgrade is expected to help the Ethereum ecosystem to continue growing.