What do crypto analysts say about ETH hardfork and EIP 1559?
2 min readCryptocurrency ETH went trough hardfork called London, which can be ranked among the most important in its history. It included the implementation of an update called EIP 1559, which changes the inflationary nature of this cryptocurrency.
The implementation of EIP 1559 brings with it the following 3 important changes:
- Transaction fees no longer go to ETH miners, after the new one is destroyed (disappears from circulation)
- Transaction sponsors can send a voluntary tip to miners to prioritize their transaction in order.
- Transaction fees are standardized for the entire network. If the network is congested they rise and vice versa.
These changes are attractive to investors for two main reasons:
- They can help reduce overall network transaction fees
- They bring a deflationary element to ETH – the destruction of ETH can reduce the overall inflation of this cryptocurrency, and at some point more ETH can disappear from circulation than is extracted at a given time. This could also have a positive effect on the price of this cryptocurrency, as its offer will expand more slowly than it was before this update.
How did analysts react for hardfork
But what do the experts think about this update?
CrossTower analyst Martin Gaspar is optimistic. He said that the term “deflationary ETH” has now become tangible and may have a direct impact on the price of the cryptocurrency.
Alex Svanevik, who founded Nansen, warned that it would take some time, perhaps up to weeks, for this innovation to have a real impact on the ETH network. The numbers so far are simply not comprehensive enough to make any conclusions. ,, When wallets etc. will start using the features of EIP 1559, then we will know more about how this update will affect ETH in the long run,” said.
The influence of EIP 1559 on ETH in terms of price will be significant according to Alexandra Lorese from Quantum Economics. “Increased lack of ethers will bring a longer-term effect on factors related to supply and demand. In the short term, this is another reason to be related to ETH bullish. I believe that this is another supporting factor in the ETH rally. “
“This is the most extensive innovation at ETH in recent years. A bit of me still thinks that some ETH maximalists thought it would never happen. “ said Tom Salter, an analyst at ByteTree.
Watch how much is burned
If you are interested in how much ETH is burned during new excavated blocks, you can see it on the page “Watch the Burn“Or on the web Etherchain.org/Burn. On the live graph you will find data on the number of extracted ETH, paid tips and also the value of burned ETH for each extracted block.
At the time of writing, more than 3,870 ETH have been burned, ie since Thursday’s London hard fork.
