According to the Etherchain website, half a million Ethereum [ETH] have been burnt on the ETH network. At the time of publication, the amount burned was $1.7 billion. Previously, ETH miners would have earned the same amount of money and would have most likely realized it on the market.
Mechanism For Burning Ethereum
The fee-burning feature was added to the Ethereum network with the EIP-1559 upgrade. The miners’ fee, which was formerly used to compensate miners for completing transactions, has been converted to a basic cost since August. The miners’ reward is now provided as a tip, while the base fee gets burnt.
Every day, as the number of transactions on the ETH network grows, more coins are burned, resulting in Ethereum being a deflationary asset with more coins destroyed than distributed.
With the fee-burning mechanism in place, the quantity of currencies on the network is continually reducing, which is predicted to have a beneficial impact on ETH’s price. Traders and investors seek to amass an asset while anticipating a price increase due to continually decreasing supply and quickly growing demand.
Ethereum’s price has already reflected the effect, with a 26 percent increase in October. Ethereum rose by more than 20% immediately after the upgrade but rapidly retraced down to almost 30%.
At the time of writing, Ethereum is presently trading at a price of around $3,582 USD, with a daily growth rate of 1.28%.