As reported by Decrypt, about 603,452 ethers (ETH) – around US$ 2 billion – have already been burned by the Ethereum network, boosting cryptocurrency to its recent historic high.
Network token burning started after the implementation of the London update (or EIP-1559) on August 5th. With the new mechanism, around $30 million worth of ETH tokens are sent to a burning address every day.
This replaced the old ETH payment method for miners to validate transactions.
According to Decrypt, the London update is one of the steps in the transition to Ethereum 2.0, which will feature the proof-of-stake (PoS) protocol instead of the costly proof-of-work (PoW).
Although the “merger” with Ethereum 2.0 is scheduled for early next year, it will still be a few years before the new Ethereum has the same standalone contract capabilities as the current version of the network.
However, it is necessary to pay attention to the main misconceptions about EIP-1559. The biggest one is the belief that the upgrade would reduce gas rates.
To convert a token on Uniswap, for example, it is still necessary to pay US$ 38.69, and the high cost of issuing an NFT remains. What was proposed by the update was to make transaction fees more predictable.
With the burning of tokens, the asset is generally appreciated, which was no different with Ethereum. This week, ether hit a new all-time high of $4,366.
However, the new record went unnoticed, due to the new historic maxim of the world’s oldest cryptocurrency, bitcoin (BTC). On Wednesday (20), the BTC surpassed the mark of $ 66 thousand, after the approval of the first bitcoin futures ETF two United States.
I am an author at Global happenings and I mostly cover automobile news. In my time working in the automotive industry, I have developed a keen interest in the latest developments and trends. My writing skills have also allowed me to share my knowledge with others through articles and blog posts.
