ETH Testnet burned 88 thousand ETH in preparation for EIP-1559
The ETH test burned 88,000 coins in preparation for EIP-1559 as the long-awaited upgrade to Ethereum is getting closer. So let’s read more in today’s latest Ethereum news.
The long-awaited upgrade for Ethereum is getting closer, as the hard fork is launched on the Ropsten testnet in preparation for the mainnet rollout in July and the upgrade involves even more deployments. The highly anticipated EIP-1559 change will regulate the transaction fee. Mechanism:
– Nethermind (@nethermindeth) June 24, 2021“
The next phase of the hard fork implementation is the rollout of the Goerli testnet planned for June 30th, which will then start in the Rinkeby testnet and then at the end of the month on the mainnet. As part of the EIP 1559 program, in addition to changing the fee auction structure, the abolition of the basic fee would drain the entire economy over time. A new website called Watch the burn has been set up to track this action, and at press time, 88,483 ETH had been burned on the testnet, or about $ 177 million at today’s prices.
ETH software solutions company Consensys estimates that the annual change in supply will be minus 1.6 million coins, and at current prices that equates to a burn of 3.2 billion US dollars in ETH, which would lower the exchange rate. The deflationary properties of the network will be further improved if the proof of participation in the mainnet for ETH 2.0 is published next year and the asset is no longer mined.
Predictions global founder Ryan Berckmans has detailed how these deflationary mechanisms will push the price up to the 5-digit figure, arguing that this is effectively giving ETH to the owners, not the miners who mine, if Assets become scarce due to fee burning. However, hopes of major gas savings from the upgrade were dashed, and ConsenSys confirmed that this was not the goal of the EIP:
“As a side effect of a more predictable base charge, EIP-1559 could lead to some reduction in gas prices if we assume that charge predictability means users pay too much for gas – burn less often.”
Ethereum price is back to the $ 2000 level and the asset is up 4.2% on the day but remains in a downtrend. CoinGecko reported a 20% drop in ETH price overnight and the world’s second largest asset is now down 54% from its ATH of $ 4,350. There may be another wait game to see what happens before the scarcity and demand attributes are reflected in the price action.
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