Ethereum Has Burned 1 Million ETH Since August Hard Fork
Since EIP-1559 went into effect, over $4 billion in transaction fees have been destroyed by the Ethereum network.
The London hard fork included EIP-1559, which changed how transaction fees are collected.
The price of ETH has risen roughly 50% since the August upgrade.
Ethereum the smart contract protocol, Three Arrows Capital founder Su Zhu publicly criticized for valuing profits more than people now has burned more than 1 million ETH($4.3billion) since the upgrade back in August.
Ethereum developers updated the blockchain with EIP-1559, an Ethereum Improvement Proposal that instituted a base fee, not for miners who validate network transactions, but for the network to take out of circulation.
The change was put in place as what is called a “deflationary” tactic, while also slowing the tokens growth rate. This also allows for larger block sizes, which helps alleviate some of the traffic on the Ethereum network.
Ethereum has been partially successful here, the network has issued nearly 1.5 million new ETH as rewards to miners. But it has "burned" 1 million ETH collected in fees, resulting in a net issuance of just around half a million, according to data site Watch the Burn. But whereas Bitcoin has been able to keep average transaction fees below $5.00 each day over the last three months, average Ethereum fees have been above $10 and regularly ascend past $50 (levied in ETH, of course).
Zhu who has been known to invest in ETH in addition to other blockchains such as Solana and Avalanche, had this to say on twitter over the weekend.
"The idea of sitting around jerking off watching the burn and concocting purity tests, while zero newcomers can afford the chain, is gross," Zhu wrote.
That may well be true, as high gas fees combined with high coin prices keep those on the outside of Ethereum looking in. But to those already invested, the burn is infinitely better than a fire sale.