BTC PULSE
No Result
View All Result
Play Now
No Result
View All Result
BTC PULSE
No Result
View All Result
Play Now
Home Ethereum

Developer Says Ethereum Burn Rate Exceeded Expectations During The Crypto Winter

by Chiwuike Owunwa
Mar 3, 2023 - 12:00 am
in Ethereum
Developer Says Ethereum Burn Rate Exceeded Expectations During The Crypto Winter

On the 2nd of February 2023, Qiao Wang, core contributor at Alliance DAO, tweeted that the Ethereum burn rate exceeded expectations despite the crypto winter. 

https://twitter.com/QwQiao/status/1631261023301672961

Qiao Wang stated that he could not think of any better asset to own in the crypto world other than Ethereum, as its burn rate amidst the bear market exceeded his expectations. 

Last year was undoubtedly a brutal year for crypto investors. Bitcoin and other digital assets were battered by the 3AC and FTX turmoil, resulting in a massive decline. 

Ethereum, the world’s second-largest cryptocurrency, launched in the middle of the Bitcoin bear market in 2015 and implemented a token burn mechanism on August 5, 2021, all thanks to the EIP-1559 upgrade. Since then, recorded data from Glassnode indicates that nearly $9 billion worth of tokens has been burned cumulatively.

Burning of tokens is explained as sending tokens to an address from which the tokens become irretrievable. The aim is to destroy tokens in order to reduce the asset’s circulating supply over time.

This new fee-burning mechanism is aimed at changing how transaction fees are calculated on the Ethereum blockchain. With each new transaction, Ethereum began removing a portion of the transaction fee from circulation. This is because the demand and supply law affects any asset’s price, which states that a decrease in supply causes the price to increase. The burning mechanism reduces the supply of ETH, causing the price of ETH to increase over time.

According to data from Ultrasound.money involving several chats and analyses, a total of around 2.8 million ETH tokens have been removed from the supply since the burn mechanism was instituted.

According to analysis from a Glassnode chart, during the bull run of 2021, $20 million to $75 million worth of ETH was being destroyed daily. This has fallen to only around $2 million to $4 million worth of ETH burned daily in December 2022. 

A deeper dive into data from Glass Node indicates that the mean gas fee has fallen significantly to around 15-20 Gwei from around 100 Gwei before the implementation of EIP-1559. 

Some users speculate that changes would be made during the Shanghai update. There is a belief that the burn rate would increase after ETH assets get unstaked, or the issuance mechanism would be changed, affecting the stake rate and transaction cost. 

therefore, if the staking rate increases, the burn rate will reduce.

Tags: EthereumFTX
Chiwuike Owunwa

Chiwuike Owunwa

Chiwuike is a frontend programmer and writer with 3 years experience in the Web3. He's meticulous researcher, enthusiastic about Blockchain and the future of crypto, DeFi, and the Metaverse.

Related Posts

Freysa AI and DeepBook logos on a rising crypto chart against a backdrop of blockchain visuals.

Institutions Accumulate $4.17B in Ethereum as Price Surges Past $4,000

August 9, 2025

Institutions and whales snapped up $4.17B in ETH over the past month, pushing prices past $4,000 and fueling...

Vitalik Buterin proposes gas cap to improve Ethereum security and stability

Vitalik Buterin Proposes Gas Cap to Strengthen Ethereum Security and Stability

July 6, 2025

Vitalik Buterin proposes capping Ethereum transaction gas at 16.77M to reduce DoS risks, enhance stability, and support zkVM...

Ethereum logo over a digital network representing global trustware infrastructure

Vitalik Buterin Proposes ‘Pluralistic’ Digital IDs to Defend Privacy and Fair Access

June 28, 2025

Vitalik Buterin warns that rigid digital IDs can erode pseudonymity. He proposes pluralistic systems to protect privacy, fairness,...

Ethereum logo over a digital network representing global trustware infrastructure

Ethereum Whales Bet Over $100M on Price Rebound Amid US-Iran Conflict

June 23, 2025

Ethereum whales bet $100M on price rebound amid US-Iran conflict, defying bearish sentiment and rising geopolitical risks in...

View All
BTC-Pulse LogoTransparent

© 2024 BTC-PULSE. Disclaimer: The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.

Info

  • Learn
  • Price Prediction
  • Events
  • Press Releases
  • Sitemap

Company

  • About Us
  • Terms of Service
  • Privacy Policy
  • Contact Us
  • Advertise

News

  • Altcoins
  • Bitcoin
  • Ethereum
  • NFT
  • Regulation
  • WEB 3.0

©2024 BTC-PULSE – All right Reserved.

No Result
View All Result
  • About Us
  • Advertise
  • BTC-PULSE
  • Contact Us
  • Events
  • Privacy Policy
  • Sitemap
  • Terms of Service