- The EIP-1559 modified Ethereum’s fee rate to a deflationary mechanism.
- The London Hard Fork was a collection of five Ethereum Improvement Proposals.
On August 5, Ethereum, the second-largest cryptocurrency by market capitalization, received a substantial update. The London Hard Fork was a collection of five Ethereum Improvement Proposals (EIPs).
Among these was EIP 1559, which attempted to speed up and reward cryptocurrency mining. In addition, EIP 1559 introduced a new burning mechanism that reduced network congestion and transaction costs. Since the update, over 3 lakh Ethereum tokens worth over $1 billion has been burnt.
The EIP-1559 modified Ethereum’s fee rate to a deflationary mechanism. It has been able to lower daily ETH production while increasing daily ether burn. The new technique allows users to burn enormous amounts of transaction fees instead of transferring them to miners.
To mitigate Ethereum inflation while still paying miners the block reward and priority fee (the highest amount users are willing to pay to include their transaction to a block), EIP 1559 proposed this. Let’s have a look at the top 5 ETH burners as per CryptoRank for today.
The high transaction fees on Ethereum are one of the primary causes of burnt ether (gas fee). On average, Ethereum conducts 1.2 million transactions every day.
OpenSea, a prominent NFT marketplace, has the most burns on the Ethereum network, as, per CryptoRank, OpenSea ranks first as it burned 89,321 ETH today, which is worth $364 Million—followed by ETH Transfers ranking second as it burned 59,433 ETH today which is worth $242 Million. And the list goes on with Uniswap V2 (43,223 ETH), Tether (31,943 ETH), and Uniswap V3 (19,068 ETH) in the following ranks.