The London hard fork, introduced on August 5, 2021, makes it possible to use ETH to pay for fees using burned Ether, which was not available previously.
The term “burning ETH” refers to the act of permanently deleting units of Ethereum’s supply. This, in theory, would restrict the supply or quantity of ETH in circulation, which is the goal of the hard fork London, which includes EIP-1559.
Since August the fire has reached record high temperatures, which appear to be linked to the expansion of decentralized finance (DeFi) platforms and the trading of non-fungible tokens (NFTs).
Indeed, a new record was set on January 10 for ETH being burned according to statistics from the Watch the Burn web portal, which recorded a total of 19,424 ETH burned in a single day. Notably, the previous all-time high was more than 16,000 ETH, which was reached in mid-October of 2021.
The Development Of DeFi Platforms
Alex Svanevik, the CEO of Nansen, a site that specializes in gathering statistics about Ethereum platforms, says that platforms such as Uniswap (in its versions 2 and 3., and OpenSea have created the most amount of gas expenditures in the first quarter of 2020, according to the data.
While Opensauce came in second place for most gas consumption in 2021, according to the report published by Defiant, it was the platform that recorded the most ether burned in 2021, with 2,755 ETH torched since the activation of EIP-1559 in August.
ETH burns when you buy or sell NFTs at an exchange
The growing interest in NFTs has resulted in greater activity in Ethereum. As a result, marketplaces like OpenSea, which is a market for buying and selling the collectible tokens, have had to pay fees as a result of the increased demand. According to statistics, the month of January, which has not yet ended, is already one of the busiest month for OpenSea’s NFT trading, with record highs being reached as shown by Dune.xyz data on trading in OpenSea, in the growth curve below.
In this post, we’ll talk about the impact of this change on the overall blockchain network, what changes have been made to the smart contracts for EIP-1559, and how this will impact the way NFT’s are traded.
Since August, these growth figures have shown how OpenSea has registered the largest commission gas consumption in 2021. It is reasonable to assume that these record highs in ETH burning are just the beginning, and that much larger statistics will be observed in the future.
After the previously specified total of 19,000 ETH was burned in a single day, excessive levels of burning have been seen to persist. This shows that there is much activity on this network despite the exorbitant fees that Ethereum charges for its transactions.
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