The Ethereum network has burned 4,600 ETH worth about $12 million within 24 hours of launching the EIP-1559 upgrade. The network rolled out the London upgrade yesterday at block height 12,965,000, to improve user experience and limit ETH’s base fee on each transaction. Shortly after the launch, the network burned a few hundred ETH and continuously burnt more quickly.
Explaining the burning process, MyCrypto developer Luit Hollander explained that the transaction initiator pays the base fee. Although the network deducts the ETH from their account, it does not give the miner value. This way, users will no longer be able to spend the token on the network. This payment is different from transaction fees because it does not make payments to the miners.
The upgrade integrated a structure to help burn transaction fees so the network would deal with high demands efficiently. Users would have to pay a base fee to burn their ETH and may decide to give miners a tip to facilitate their transactions. Miners receive 2 ETH for each block as compensation for their role in running the network. That makes a total of about 12,700 ETH daily.
Although the network is burning ETH quite fast, it may not go on this way. Hasu, a pseudonymous security researcher, wrote that the mempool would soon be empty. Once it is, the base fee will crash again, and the blocks will reduce.
“Don’t expect the current burn rate to cont forever,” Hasu wrote.
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