ETH deflationary asset? Burned fees exceed used tokens!
2 min readDeflation properties London ETH update last week they were already visible on the blockchaine with almost 800 “deflation blocks”. High increase in transaction fees for ETH lasted at least few hours when the offer was deflationary. The network has come under heavy load in the last few days, resulting in the burning of much more gas.
He just recently recorded an ‘ETH Burn Bot’ case where it was up to 545 ETH burned within one hour. With an issue reported at ETH 532 per hour, this resulted in the asset recording a record over this short period. deflation minus 13 ETH. ETH Burn Bot discovered a few hours later that 945 tokens had been burned, leading to a temporary deflation of -417 Etherea.
945.1184 $ ETH burned 🔥🔥🔥 last hour.
Issuance: 528.0000 ETH
Net Change: -417.1184 ETH
Annualized: -3.12% 📉2021-08-10 22: 00-23: 00 UTC
Last Block: 13000300
Cumulative 🔥: 24,942.1282 ETH– ETH Burn 🔥 Bot @ (@ethburnbot) August 10, 2021
Where is the amount of Ethereum burned greater than the mining fee, deflation blocks are created and the supply is temporarily reduced. So far, there have been 791 deflationary blocks, where the burnt fee exceeded the extracted ETH.
ETH as a deflationary asset? Only temporarily
When was deployed on August 5 London hard fork, introduced the highly anticipated EIP-1559 update. It modified the system for calculating transaction fees. Part of this adjustment introduced a mechanism that burns part of the basic fees.
According to ultrasound.money, which tracks the number of coins burned, was at the time of writing burned 30,998 tokens. At current prices, that’s about $ 80 million in less than a week.
However, permanent deflation is not expected until the burning of fees is associated with a reduction in block rewards due to proof-of-stake in 2022.
However, the result is that gas prices have risen again. According to Bitinfocharts the average transaction price climbed to $ 20 from a low of about $ 4 at the end of July. The Etherscan gas monitoring tool reports up to $ 28.60 for token exchange on the Uniswap server.
