2,626 ETH Worth $5M Was Just Burned
Portfolio Pulse from Benzinga Insights
On Wednesday, 2,626.94 Ether (ETH) valued at approximately $5.78 million was burned due to the EIP-1159 upgrade implemented on the Ethereum blockchain, which introduced a variable base fee for transactions that is permanently removed from circulation. This has led to a net annualized issuance rate of -0.29% for Ether, indicating a move towards a deflationary currency, especially with the anticipated Ethereum 2.0 upgrade that could further reduce the issuance rate to 0.5-1% per year.
January 25, 2024 | 6:00 pm
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The burning of 2,626.94 ETH, valued at $5.78 million, contributes to the deflationary pressure on Ethereum's supply, potentially leading to an increase in the value of ETH in the short term as the supply diminishes.
The burning of Ether reduces the overall supply, which can lead to an increase in price if demand remains constant or increases. The move towards a deflationary model with Ethereum 2.0 could further enhance this effect. However, the cryptocurrency market is volatile, and external factors could also influence the price.
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