The EIP-1559 release has worked fantastically for Ethereum as it surged from 2,728 dollars to 3,326 dollars since its release. The network has burnt over 230 million dollars in Ethereum in the period, creating scarcity for the token.
According to Bitcoin News, Ethereum is currently burning 12,000 dollars worth of ETH per minute. Dune Analytics is also following the network closely, tracking the amount of ETH burned ever since the London update. The network has burnt over 73,784 Ethereum in the first 17 days and continued the process.
Now, its ETH burning count has crossed 83,873 ETH. WIth Ethereum is currently trading around 3,309 dollars, meaning it has burned over 277,525,757 dollars worth of Ethereum.
The network had already planned for this with the release of EIP-1559, the first changes that came through the London Hard Fork. The upgrade introduced a base fee that is algorithmically calculated for every transaction on Ethereum. However, instead of transferring the fee for the related transaction to miners, Ethereum is destroying the associated ETH.
As per EIP-1559’s authors, making sure that miners do not receive the base is crucial as it eliminates their incentive to manipulate fees to extract more gas fees from traders. The design is developed to protect Ethereum, fight inflation, and decrease risks associated with mining’s extractable value.
The model does not negate the reward for miners as they can still earn supplement fees as a gratuity. However, the latest update effectively changed the entire dynamic of the network. Ethereum is burning 12,000 dollars worth of Ethereum every minute to restrict miners from hauling profits on the network.
The upgrade also introduced more changes, including shifting from the PoW (proof-of-work) model to the PoS (proof-of-stake) model.