Etherchain, an Ethereum on-chain tracking tool, indicates that the leading smart contract platform has burned thousands of ETH just three days after implementing a crucial update.
On August 5th, Ethereum officially launched the London hard fork, which consists of several Ethereum improvement proposals, including EIP-1559. The update introduces a fee-burning mechanism to the Ethereum network that permanently removes a certain amount of ETH from the circulating supply each time a transaction is processed.
Etherchain indicates that Ethereum has already burned 15,916 ETH, worth $46.55 million at time of writing.
Ultrasound.money is also following the amount of ETH burned in real time while highlighting the platforms on which the largest transactions have originated.
According to the Ethereum surveilling tool, OpenSea is at the top of the burn leaderboard as transactions coming from the non-fungible token (NFT) marketplace have torched 1,866 ETH, worth $54,86 million. Uniswap (UNI) lands at number two with a total of 1,239 ETH burned, worth about $36.41 million.
Crypto analyst Nicholas Merten explains in his new video how the coin-burning mechanism can potentially work to push the price of ETH higher in the long run.
“It is sent to an address on the Ethereum chain that no one has the private key to, that no one can send funds to, and miners won’t even respect transactions that come from it. It’s basically eliminated from the supply forever. It’s as if I had a dollar bill here and I was burning it and that causes deflationary pressure on Ethereum, meaning that the supply becomes more limited and therefore, in the supply-and-demand dynamics, is likely going to drive up the price.”
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