CryptocurrencyETH (Ethereum)

More Than 500K Ether Coins Have Been Burned

Decentralized finance is considered the most secure space when it comes to financial transactions. But from time to time, the blockchain of these respective cryptocurrencies need to be updated. If we talk about Ethereum, then without any doubt, it has the most efficient and substantial blockchain than any other cryptocurrency. Recently a major update has been shipped to this blockchain countered as EIP-1559, and instead of stabilizing the blockchain, it has actually backfired and made about half a million Ether coins disappear. This update was supposed to make Ether’s blockchain secure and more efficient, but it backfired in a horrible way.

The wiping of coins didn’t happen in a single blow but over the course of months. The whole information about the burning of half a million Ether tokens is present on the Etherchain website sponsored by the Ethereum network. At the time of writing, the total amount which was burned equals about $1.7 billion; it is a mess through and through no matter which angle you see it from. The EIP-1559 update brought a massive change in terms of the burning mechanism.

Fee-Burning Mechanism

The miner’s fee has now been changed to a base fee which was earlier used to reward miners as per helping in moving transactions. Now, these miners get their reward in the form of a tip while the base fee or anyway what’s left of it is getting burned. This whole thing is supposed to have a positive effect on Ethereum and its price. But the concerning factor is that the number of available tokens is decreasing at a faster pace with this fee-burning mechanism, in fact.

But the catch here is that with the number of tokens reducing and decreasing supply, the demand for Ether will go soaring high. This will make not only investors but traders also accumulate as much of the asset as they can and expecting a higher market price in the upcoming weeks. It is estimated that the last of October will definitely see a price boost for Ether tokens while their supply is still dwindling and unsure of the availability in the future.

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