Almost two years have passed since the implementation of the London hard fork update, with the notable implementation of the Ethereum Improvement Proposal (EIP) 1559. This crucial update has reshaped the Ethereum economy, resulting in a constant burning of the Ethereum base fee. transactions on the Ethereum network 24 hours a day.
Since the deployment of EIP-1559 with the London hard fork, more than 3.46 million Ether have been burned. Given ETH’s current exchange rate, the total value of Ether destroyed amounts to approximately $6.68 billion. On average, around 146,000 Ether are being burned each month since the implementation of this improvement proposal.
Diversified sources of ETH burning
Ethereum’s deflationary strategy, enabled by EIP-1559, has led to a gradual decline in the total amount of ETH. Most of this decrease, almost 300,000 ETH, is due to regular Ether transfers. Additionally, more than 230,000 Ether have been burned in non-fungible token (NFT) transactions on OpenSea, while Uniswap v2 has burned close to 200,000 Ether.
Tether transactions have resulted in more than 150,000 ETH being burned. At the same time, between Uniswap versions 1 and 3, more than 200,000 ETH have been destroyed. Currently, there is approximately $232.53 billion of ETH spread across 120,201,621 accounts.
Switch to Proof-of-Stake and the creation of ETH
Since the implementation of EIP-1559 with the London hard fork, the Ethereum network has created just over 3 million Ether. The Ethereum network switched from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) blockchain in an event known as “The Merge” on September 15, 2022. Since then, they have 304 days have elapsed.
If “The Merge” had not happened, the network would have generated 6.5 million Ether. Currently, there are 120 million ETH in circulation, a figure that would have increased by 9.9 million if the chain had persisted in the PoW approach and not implemented EIP-1559.
With these modifications to the Ethereum economy, the network is expected to continue its evolution and further develop its decentralized ecosystem. The figures are a clear indication of the deflationary dynamics of Ether and how changes to the blockchain can have a significant impact on the global digital economy.