At the current burn rate, over $800,000 worth of Ethereum (CRYPTO: ETH) is burned every 60 minutes.
What Happened: Data from Watch The Burn shows that 210 ETH is burned every hour, while the net issuance is around 400 ETH per hour.
This corresponds to a net reduction of 34.42% in Ethereum’s overall supply.
When network activity on the Ethereum blockchain increases, so too does the gas fee, which triggers a higher burn rate.
Before the implementation of Ethereum’s fee-burning mechanism, users would have to bear the burden of a higher base fee incurred when prior blocks in the network were full.
Overall, a total of 1.19 million ETH has been burned worth over $4.56 billion at the time of writing. Meanwhile, total net issuance is at 574,711 or $2.19 billion, giving rise to a total net reduction in Ethereum’s supply of 67.52%.
Why It Matters: “ETH is ultrasound money when fee burn exceeds issuance,” commented Ethereum researcher Justin Drake earlier this year.
ETH is ultrasound money when fee burn exceeds issuance.
Ethereum crossed the ultrasound barrier ~5 months ago, now cruising around ultraMach 2. pic.twitter.com/MhzcSb0bbi
— Justin Ðrake 🦇🔊 (@drakefjustin) March 1, 2021
As of Wednesday morning, ETH was trading at $3,705.78, down 2.26% in the last 24 hours. The market-leading cryptocurrency BTC was trading at $46,827.39, down 0.22% over the same period.
Photo by Art Rachen on Unsplash